Fd Rules as per income tax
Fixed deposit was considered to be the safest investment, because it used to get a return of 7 to 10 percent and you must have also heard saying in the house that if there is any extra cash in the house or if there is any money in the savings account, then should be deposited in FD.
First of all let’s talk about why FD should be done? Under what conditions can you get a notice from the Income Tax Department? How much tax is levied on FD or how much tax is levied on its interest and what tax benefits available from FD, we will also talk about them.
Loan facility is also available from FD. How much TDS is deducted on FD, how TDS can be avoided and what should we do if TDS is deducted, to get refund of that TDS and if you have FD in any bank then is it compulsory to file ITR.
If you have FD in any bank then what are the benefits and senior citizens get different benefits in FD. What benefits they get, they will also discuss. FD has not only advantages, FD also has some disadvantages, so we will talk about those disadvantages as well. Fd Rules As Per Income Tax
Why FD should be done
So first of all let us talk about why FD should be done as I told you FD is considered a secure investment. Assured returns are available in FDs. That is, you got an FD in a bank, the rate of your FD could be anything at six or seven percent.
At that rate, the time period that you got FD done is now, if you have done FD for one year, then after one year you will get the same return.
Regardless of the bank in which you get the FD, it is getting profit or it is losing. You are guaranteed to get the same return at the rate at which you get the FD, that’s why FD is considered an investment with assured returns, in which you get guaranteed returns.
Now it comes to whether you will get returns even if the bank sinks, then the answer is yes, if any bank sinks. Fd Rules as per income tax
So in that you are provided with insurance up to ₹ 5 lakh. Full form Deposit Insurance Credit Guarantee Corporation is done by DICGC, it is a subsidiary of RBI itself, what does it work, it provides insurance to all the customers of all the banks.
That is, as soon as you have opened an account in any bank. You got insurance of ₹ 5 lakh, that is, if you have an amount up to ₹ 5 lakh in that bank and that bank sinks, then you will get ₹ 5 lakh.
If you have more than 5 lakh amount in any particular bank and that bank gets enforced, then you will get only 5 lakh and if you have 2.5 lakh rupees then you will get 2.5 lakh rupees.
All this work is done by DICGC which will help you to get your money back through insurance and there is one more benefit of FD, if you keep your balance in savings account and you are not getting it of any use,. So you can get it FD for one year,
so what will happen, you will get more return inside the FD, than what you are getting in the savings account.
Tax interest related to FD
Now let’s talk about tax interest related to FD, if there is any income from your FD interest, then it is fully taxable as your normal tax is levied.
If you are an individual and are below 60 years of age, then your total income up to Rs 2.5 lakh remains assumpt, as the income comes in the tax slab. That is, if your total income is less than 2.5 lakhs and also included FD interest in it, then no tax will be levied on you. Fd Rules as per income tax
But if your total income goes above 2.5 lakhs for the year, then according to that tax will be charged on it and if you are a senior citizen then this 2.5 lakh limit is 3 lakhs for them and you are a super senior citizen then their limit of 3 lakhs is 5 lakhs.
If a senior citizen earns income from FD interest, then he gets an additional assumption of up to ₹ 50,000. If your FD interest income is becoming ₹ 50,000, then the entire amount will be assumpt to you.
If your income from FD interest is getting more than 50,000 then that 50,000 then it will be assumpt there. If his additional income will be calculated according to your normal tax slab, then this senior citizen is given a separate benefit.
Read out this also ::—-
If someone gets an FD for more than 5 years, then it is called tax saver FD, in that you get deduction of 1.5 lakh rupees. Fd Rules as per income tax
Here the deduction you will get will be for the investment amount and the one who was a senior citizen, there you will get the deduction of interest income. This is a 80c case for all the taxpayers who file itr.
Loan on FD
Now let’s talk about the loan on FD, if you have got FD in any bank and you need any fund in emergency. Now you think that you need that fund only for a month or two and you have got the FD done for a long time, then if you withdraw money from that FD, then you will be charged panel interest on it
suppose you have FD and the rate was done 6 percent. From there your return of one or two percent is deducted and the return you will get is not 6 percent, if you get the FD pre-matured or withdraw the FD, then you pay 1 to 2% panel.
Interest will be charged and the return you will get over the FD will be only four or five percent. Fd Rules as per income tax
Therefore, you are given the facility of loan against FD by the bank, what is there in this, if you feel that you have a fund requirement for one or two months, then you can take a loan against that FD only.
This is the loan amount, you can get up to 90% of the amount of your FD, suppose you have got an FD of ₹ 1 lakh for a long time and you need some money for a month or two, so now that FD You can take a loan .
There your penalty interest charge will not be there and the rate of loan given to you is also not very high. Your FD rate is only slightly higher, but it is better to take a loan against FD.
If you need money for short term, but if your FD is of one year and you want money for one year only, then the better is that you can get your FD pre-matured and for this you will have to visit the bank. for this no need to put much effort, Nor do to do much paperwork. Fd Rules as per income tax
You just have to fill a form. Your loan will be approved and it will be sanctioned soon.
Now let’s talk about deducting TDS, if you have FD in any bank, then you would have got interest income from there, then what does the bank do, your interest income which is there, it does not pay you full.
He deducts some portion and deposits it to the government and you get the remaining portion, the portion that goes to the government is ten percent and what you get is 90 percent, if you have deposited in the bank If you have not given PAN card then your TDS will be deducted twenty percent
if you have given PAN card then your TDS will be deducted ten percent, the amount of TDS which is presently deposited by the bank directly to the government, so that what happens is that the government also gets to know about this particular.
How much FD has been done in the bank? Now all your TDS will be deducted throughout the year, that entire TDS will be reflected in your 126 AS. That is, no matter how much tax has been deducted by any party in a year, the entire amount gets reflected in your 126 AS.
Now how will you know if your total income is less than the taxable limit and the bank has deducted your TDS. Which bank has deducted your TDS, then you can read 126 AS in Google for that. Fd Rules as per income tax
Now if your total income is less than the taxable limit and the bank has deducted your TDS, then what will you do, you file ITR. In that you have to claim the refund amount of TDS. If your total income is more than the taxable limit then your TDS will be deducted
But if your total income is less than the taxable limit i.e. your total income is less than 2.5 lakh rupees. 3 lakh for senior citizens, then in that case you have an option available, so that you will tell the bank that if our total income is less than this limit, then if you do not deduct our TDS, then for this you will have to fill a form And that form is Form 15 G
which fixed deposit is best
LIC Housing Finance FD
why fixed deposit rates are decreasing
The main cause behind the consistently decrease in FD interest rate is availability of the funds in bank & subsequent reason is RBI regulatory policy! RBI decrease the Loans rate
which fixed deposit is best in sbi
The highest interest rate offered by SBI is :-
for the general public 5.40% P.A
for senior citizens 6.20% P.A.
is a fixed deposit a good investment
best investment options for people who are looking for good stable returns Fd Rules as per income tax
Which bank gives best FD rates?
Axis Bank gives best FD rates
Is Post Office FD safe?
the post office fixed deposit is one of the safest option of investment
How many years FD will double in post office?
10 years Fd Rules as per income tax