Some investors try to avoid TDS by breaking up their investments into smaller deposits across several banks. If you invest `1 lakh in a fixed deposit that earns 7%, the annual interest will not breach the `10,000 limit even in the fifth year. But experts warn against such attempts to avoid TDS and evade tax. It is compulsory to submit your PAN when you invest in a fixed deposit. There is no way to keep such investments hidden for long.

Others try to hoodwink the tax authorities by submitting Form 15G or 15H so that their bank does not deduct TDS. These forms are declarations that the individual's income for the year is below the taxable limit and therefore no TDS should be deducted from the interest. However, misuse of these forms can invite the wrath of the tax department. A false declaration not only attracts penalty but also prosecution. The taxpayer can be sentenced to jail for terms ranging from three months to two years

You need to meet two basic conditions to file form 15G. One, your taxable in come for the year should not exceed the basic exemption of `2.5 lakh. Two, the total interest received during the financial year should not exceed the basic exemption slab of `2.5 lakh. Mind you, the total interest income should include interest from other sources, including PPF and NSCs. Form 15H, which is for senior taxpayers above 60, imposes only the first condition. The final tax on the total annual income should be nil. So, senior citizens whose taxable income is below the `3 lakh limit are eligible to file Form 15H. For very senior citizens above 80, this limit is `5 lakh.