10 Things To Know About Income-Tax Saving Bank Fixed Deposits (FDs)
According to SBI's website, the minimum amount required to open an income-tax saving fixed deposit with the bank is Rs 1,000. The deposit should not exceed Rs 1.5 lakh a year.
SBI offers tax-saving deposits at a minimum tenure of five years and a maximum of 10 years, according to the bank's website.
Remember that interest earned in income-tax saving FDs is taxable as per the investor's tax bracket.
TDS or tax deducted at source is applicable on the interest earned. TDS becomes applicable when interest payable or reinvested on fixed deposits across all branches, per customer, exceed Rs 10,000 in a financial year.
Interest on income tax-saving deposits is payable on a monthly/quarterly basis. The interest amount earned can be reinvested, if the investor wants so.
In case of joint deposit, the tax benefit under Section 80C will be available only to the first holder of the deposit.
|Banks||Minimum Tenure||Minimum Amount||Maximum Amount||Interest Rate For General Public||For Senior Citizens|
|ICICI Bank||5 years||10000||150000||6.50%||7%|
|HDFC Bank||5 years||100||150000||6%||6.50%|
Tax-saving fixed deposits have a lock-in period of five years. No premature withdrawals or loans are allowed.
Nomination facilities are available in case of income tax-saving fixed deposits.
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