Fixed Deposit: Along with the rise within the curiosity of financial institution loans, the curiosity of Fixed Deposit Scheme has additionally been elevated. Many banks are providing curiosity starting from 7 to 9 p.c for frequent residents to senior residents (Senior Citizen FD). In such a state of affairs, it may be a very good funding alternative. At the identical time, Tax Saving FD Scheme has additionally been began by banks, through which it can save you tax with extra returns by investing.

If you might be planning to spend money on Bank Fixed Deposit (Invest in Tax Saving FD) and likewise need to save tax, then Tax Saving FD could be a higher choice. Here, data has been given about 5 such banks, which together with saving tax are additionally giving excessive returns.

These 5 banks are giving extra curiosity on tax saving FD
DCB Bank will give a quarterly return of seven.25 p.c on financial institution tax saving FD.
City Union Bank is giving a quarterly return of seven p.c on tax saving FD.
AU Small Finance Bank is giving a quarterly return of 6.95 p.c on tax saving FD.
– Indusind Bank will give 6.75 p.c return on tax saving FD.
Yes Bank will give 6.75 p.c return on tax saving FD.

How a lot tax exemption will likely be out there
If you might be investing in a tax saving FD, you may declare a deduction of Rs 1.5 lakh beneath Section 80C of the Income Tax Act, 1961. The curiosity beneath this FD will likely be deposited in your financial savings account in a yr. However, TDS cost of 10 p.c should be given on the curiosity, which may be withdrawn by claiming ITR whether it is lower than the prescribed restrict.

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Features of Tax Saving FD
According to the ICICI Bank web site, the lock-in interval of tax saving FD is for five years, beneath which tax as much as Rs 1.5 lakh may be saved yearly. Premature withdrawal, mortgage and overdraft services are usually not out there on this FD. Under this, single or joint account may be opened. The facility of auto-renewal facility is just not out there beneath this.

Read additionally: Fixed Deposit: Who among SBI, HDFC and ICICI Bank is paying the highest interest on FD? Know where to invest money