Income tax return filing season: Tax Saving Fixed Deposit (FD) has emerged as a popular investment option for senior citizens due to its attractive returns and tax benefits. Not only does it offer tax savings, but it is also a safer alternative to high-risk equity investments and other risky options. This option allows investors to claim tax exemption under Section 80C of the Income Tax Department.
Investing in a Tax Saving FD can provide good returns while also offering tax benefits. Those looking for a tax-saving investment option without risk can consider this option, which offers up to 8.1% interest.
Several banks offer attractive interest rates on Tax Saving FDs. DCB Bank offers the highest interest rate of 8.1%, while Axis Bank and IndusInd Bank offer a rate of 7.75%. Yes Bank, HDFC Bank, ICICI Bank, and IDFC First Bank offer a rate of 7.5%, while Bank of Baroda, SBI Bank, and PNB Bank offer 7.15%, 7.5%, and 7% interest rates, respectively.
Investing in a Tax Saving FD allows individuals to claim tax exemption under Section 80C of the Income Tax Act, 1961. This exemption can provide a discount of up to Rs 1.5 lakh, but it is only applicable for FDs with a maturity period of five years. Senior citizens can also claim a rebate of up to Rs 50,000 on interest under Section 80TTB of the income tax act during a financial year.
March 31, 2023, is the last chance to save tax for the financial year 2022-23. Therefore, if one wishes to save tax during this financial year, investing in a Tax Saving FD is a viable option.
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