How to read a tolerance like H7
The letter tells where the tolerance zone sits relative to the nominal size, the number how wide it is. Capitals are for holes, lower case for shafts. H7 on 20 mm means the hole can go from 20.000 to 20.021 mm: with H the lower limit is always nominal.
Hole basis: why you almost always start from H
In the shop the hole is made with fixed-size tools (reamers, cutters, boring heads), while the shaft can be turned or ground to any size. So the hole stays at H and the shaft letter is chosen for the fit you want: f and g to run or slide, h to locate, k, m, n for transition fits, p and beyond for interference.
Clearance, transition, interference
If the smallest hole is still larger than the largest shaft, there is always clearance. If the smallest shaft is larger than the largest hole, there is always interference and assembly needs a press or heat. In between are transition fits: depending on the actual parts, a little clearance or a little interference.