Saving Tax on Fixed Deposit Interest

[Being.smart]

Is it possible to get refund of the tax being deducted by bank on Interest being provided on Fixed Deposits.

Mom got salary more than the desired limit and she pay's Income tax every year. The interest which comes on FD, on what too bank imposed tax..

I already added PAN to all FD's, ain't there any solution to prevent it from taxation..

* Don't say to split the FD's into 1lac in various banks, that's very lame idea and not possible for me

 

[NinByChoice]

FD interest is taxable. You will have to pay tax on it anyway. What exactly do you want to do?

There are many ways to reduce your taxable income though. Here are some

1) Tax Saving FD
2) Tax Saving ELSS
3) PF Contribution
4) Donations to PRF/certain other charities

 

[agantuk]

FDs are taxable. You cannot claim a refund if you have taxable income for a year. If there is no taxable income, file returns and get the refund.

 

[Lord Nemesis]

^^ Exactly, It seems a lot of people are unaware of this fact. Interest earned on FD's and Saving Account is also seen as income and is taxable (according to the tax slab you fall into). Technically, you have to show that interest amount and due taxes deducted when filing the IT returns.

 

[Kuantum]

10 % if pan is declared with the account else 20%

If eligible for refund the tax department will refund back with interest for the overdue period.

Tax payers are waiting for years for a refund. The only other alternative is meet your ward officer to sort out refund

 

[Party Monger]

When you file the return for refund, please make sure your return preparer outs your bank account number and the branch code to facilitate direct transfer of refund to your account. Other wise thye'l ask you for bribe upto 25% of the amount. (standard rate)

 

[MAGNeT]

Is it possible to get refund of the tax being deducted by bank on Interest being provided on Fixed Deposits.

You need to file return and claim refund if excess tax deducted.Also getting refund these days is not that easy again(internal circular released todelay refunds so that government can use the money for time being.)

Mom got salary more than the desired limit and she pay's Income tax every year. The interest which comes on FD, on what too bank imposed tax..

I already added PAN to all FD's, ain't there any solution to prevent it from taxation..

I didnot got the point.Your mother got salary and if she falls under taxable limit than company might have cut tds.Now fd interest too is added in gross and even they are taxable.Than why you want to avoid paying tax on it.If she doesn't fall under taxable bracket than you should try to avoid paying tax on fds.
For bank not to deduct tds on FD one needs to fill 15G form stating we dont fall under taxable bracket and for senior citizen the form is 15H(every financial year till fd matures).

But mind you in this form you give a consent that your income is less than taxable limit.If in future while assessment it is found you just trying to avoid tax than you might be penalized.

* Don't say to split the FD's into 1lac in various banks, that's very lame idea and not possible for me

Its quite feasible and please its not lame idea.There are banks which doesnt send tds certificate on time hence one of the method of financial planing to have trouble free investment.
In my case for hdfc bank i can make fd online.And for my sister account while making an fd for 8 lakh rupees i made 8 fds worth rupee 1 lakh each with different branch address selection some as far as 200 kms away from my place.But just make sure its redemption on maturity not reinvest type else you might be in bigger trouble.

 

[Being.smart]

Thx @MAGNeT for sorting my problem ... Got cleared all of my doubts..

Splitting FD is lame idea for me. as FD's are with SBI , But can you tell me how did you managed to open FD ! 1 lakh with same HDFC account but with different branch addy :O, I personally don;t like it because i will have to make run to XX+++ branches

 

[MAGNeT]

Thx MAGNeT for sorting my problem ... Got cleared all of my doubts..

Splitting FD is lame idea for me. as FD's are with SBI , But can you tell me how did you managed to open FD ! 1 lakh with same HDFC account but with different branch addy :O, I personally don;t like it because i will have to make run to XX+++ branches

Brother as i mentioned.I am not sure about sbi but check internet banking of the same.

In my case i do all my transactions of light payment to everything via net.So check the internet banking option of your bank it might be available there too.

Just click the option of make fixed deposit.Than choose the manner whether you want to redempt or reinvest .How the interest needed cumulative ,quarterly,monthly.Also which state and which branch.I mostly choose branches near to my place but since amount was much some branches are too far.But since its redempt on maturity option not much trouble for me.

Also i get tds check option online or link to my 26as(where tds deducted seen) from my account.

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