In this article I will be writing about the tax savings fixed deposit. It is one of the popular component for the investors because of the guaranteed return amount. As of now the interest rates are not much attractive hence it losses the shine. This article presents the important facts about the tax savings fixed deposit. If you have any doubts, please post it in the comments section. Subscribe to our free newsletter.
Tax Saving Fixed Deposit u/s 80C
Section 80C provides the fixed deposit option for the tax exemption. The following are the key points regarding the tax saving fixed deposit u/s section 80C:
- It has the lock-in period of 5 years. depositing under this scheme, you will not be able to take the money before five years.
- The interest rates for this scheme will be vary for each bank.
- Tax savings fixed deposit is available only through banks. You can not open it with company fixed deposit product.
- Minimum of Rs.100 is deposited.
- Maximum of Rs.100000 is exempted u/s 80c for one financial year.
- If you are depositing in this scheme, there will not be many other benefits which is allowed for the normal fixed deposit
- No Partial/Premature withdrawal allowed.
- Sweep-in not allowed.
- No Over Draft facility allowed.
- If you have the joint account, the deductions u/s 80c will be allowed only for the first account holder.
- The interest income for this fixed deposit is taxable.
I hope this article will be useful for learning the basic ideas about the tax savings fixed deposit. Nowadays, the interest rates are not good, so it is not advisable in choosing the fixed deposit. If you have any doubts, please post it in the comments section.
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