Lux Investing
TDS on Fixed Deposits in India and total return on maturity?
My dad is planning to invest INR 10 lakhs on a fixed deposit scheme with State Bank of India for a term of 4 years. His age is 60+ and is a retired businessman. I would appreciate if anyone could help me know about the amount of income that could be lost in the form of TDS on interest gained and what would be the total return on maturity. Thankyou.
Public Comments
- With respect to FY 2011-12 TDS on Fixed deposit would attract if the Interest on Fixed deposit for complete FY (April 2011 to Marc 2012) from one branch exceed Rs 10,000, the TDS rate being 10%. However, if Interest income is the only income, then you can submit Form 15G (certificate for non deduction of TDS) and TDS would not be deducted. The return would be Interest less TDS Thank you
- Sasi! If interest on this deposit is the only income of your dad, then, the annual income will be Rs. 97,500 from this deposit. Your dad can earn income upto Rs. 2,40,000 every financial year without paying any income tax. In addition, if he can save Rs. 70,000 in PPF and Rs. 30,000 in NSCertificates or related instruments, then, he can furnish form 15H (for senior citizens) and need not have any tax deduction upto a total income of Rs. 3,40,000 (in a financial year.) However, HE MUST HAVE A PAN no. allotted to him, as otherwise, he cannot avoid TDS which will be higher @ 20% of the interest paid or credited.
