Best Interest rate and other Facilities
What are fixed deposits?
Tyes of fixed deposits?
What are the benefits of fixed deposit?
Is fixed deposit safe?
Unlike market-dependent investment options like a mutual fund, SIP and stock, a fixed deposit is safe. An FD is not dependent on market growth; hence the interest rates do not fluctuate and remain stable throughout the fixed deposit tenure.
Are fixed deposits tax free?
With a tax-saver FD, you can claim tax deductions against your deposit. You can claim deductions up to Rs. 1.5 lakh per annum, according to Section 80C of the Income Tax Act, 1961.
The interest income you earn is fully taxable as it is considered ‘Income from Other Sources’ under the Income Tax Act, 1961. However, it is noteworthy that if the total income (including FD interest) is below Rs. 5,00,000 per annum they shall be exempted from paying tax. There are ways to save taxes on your FD investment. You can open a tax-saver FD or submit forms 15H and 15G for your existing fixed deposit accounts.
As per section 194A read with Part II of First Schedule to Finance Act, tax is to be deducted @ 10% from the amount of interest. TDS will be deducted by bank if your interest income more then Rs. 40000/- per annum in any bank including various branches.
There will be no TDS on the total interest received on FD/FDs from a single bank if it is less than Rs 40,000 in a year from that bank. For senior citizens, TDS on interest received on FD will be applicable if it crosses Rs 50,000 in a single financial year.
Even is such Interest on FD amount is not actually paid and only credited to customer account then also TDS is to be deducted.
Disadvantages of Fixed Deposits?
Disadvantages of FD :-
- Low returns. While FD returns are guaranteed, they are also low, as compared to other short-term market-linked investments.
- Liquidity. Withdrawing your FD before the date of maturity leads to a penalty charge. …
- Tax returns. Interest earned through your FD falls under the taxable slab of your income.
Is fixed deposit interest paid monthly?
There are mainly two types of modes of receiving the interest. One is cumulative option where the interest is compounded on a quarterly, paid on the maturity of the FD/ autorenewed. The other is a non-cumulative option which is paid in the form of monthly interest or quarterly or on maturity.
Which is better for FD bank or post office?
The bank FDs have flexible tenures ranging between 7 days and 10 years, whereas post office schemes can be stretched only up to five years
Which deposit is best?
A Fixed Deposit is one of the Term Deposits offered by the banks. This is the safest and most popular investment option. According to this, one has to invest a lump sum amount at one time in a bank.