Fixed Deposit Income Tax Exemption
April 12, 2023 ⚊ 1 Min read ⚊ Views 80 ⚊ BUSINESSTax-saving fixed deposit accounts come in many forms and allow individuals to save money. You are free to choose the term of your fixed deposit, but banks generally have a 5-year fixed deposit system for tax savings. Investing in tax-saving FDs allows you to claim tax incentives under Section 80C of the Income Tax Act. In this article, learn about tax savings on FDs, fixed deposit income tax exemption, and tax benefits and restrictions on fixed deposits.
What is Tax Saving FD?
Tax Saving FD is a type of fixed deposit that allows individuals to claim a tax credit under Section 80C of Income Tax, 1961.
These deposits are through two types of accounts, single holder deposits, and joint holder deposits. If you choose joint ownership, tax benefits are only available to the first owner.
The term of the tax-saving fixed deposit is 5 years. Section 80C deductions are available for Hindu undivided families (HUF) and individuals.