Tax-saver FD

A tax-saver fixed deposit is specifically designed to help individuals save on income tax. You can deposit a lump sum amount for a fixed tenor, with a lock-in period of 5 years. The investment in such FDs qualifies for deductions up to ₹1.50 Lakhs under Section 80C of the Income Tax Act, 1961.

Here are the rates for tax-saving fixed deposits from some FD issuers:

Note: The above tax-saver FD interest rates are subject to change at the issuer’s discretion.

The eligibility criteria and documents required for a tax saving FD may vary slightly between banks, but generally, they adhere to certain common parameters.

1. Eligibility Criteria

• Residential status:  Resident Indians, including salaried and self-employed individuals

• Age: At least 18 years old

• Investor Type: Individuals and Hindu Undivided Families (HUFs)

2. Documents Required

• Identity proof: Aadhaar card, passport, Voter ID, PAN card, and senior citizen identification (if necessary) 

• Address proof: Utility bills, driving license, Voter ID, Aadhaar card, and passport 

Avoiding TDS on fixed deposits involves strategic financial planning. Here are some strategies:

• Submit Form 15G or 15H

You can submit Form 15G (if below 60 years) or Form 15H (if above 60 years) to the bank to declare that your total income is below the taxable limit. This exempts you from TDS.

• Distribute Investments

Distribute your investments across multiple banks or tenors to keep the interest earned from each FD below the threshold. The TDS limit has been fixed at ₹40,000 for the general public and ₹50,000 for senior citizens. 

Before you invest in a tax-saver FD, compare it with these top tax-saving options:

The information provided by BFDL is related to the rates provided by Banks and Deposit taking NBFCs as available from public domain and under no circumstances is intended to be source of advice or recommendation of any financial investment advice or endorsement of any sort. BFDL disclaims any responsibility or liability regarding inaccuracies, omissions, mistakes etc. as well as offers and use of such information set out is entirely at the User’s own risk and User should exercise due care prior taking of any decision, on the basis of information mentioned hereinabove. Display of any intellectual property along with the related product information does not imply BFDL’s partnership with the owner of the intellectual property of such products and is solely for the purpose of information, unless otherwise provided by BFDL.