If you are looking for a safe and fixed return investment with low risk, then Fixed Deposit (FD) has become the best option at this time. The reason is that many banks are offering excellent interest rates of up to 7.4% on 1 year FD for common citizens (below 60 years of age). At a time when market fluctuations are increasing, these returns on FD can provide good profits while keeping your savings safe.
Who is paying the highest interest?
Some small finance banks are still offering the most attractive returns on tenure of 1 year. Let us know how much interest is being received in which bank.
- Suryoday Small Finance Bank: For common citizens, Suryoday Small Finance Bank is offering interest up to 7.4% on 1 year FD. This is one of the highest interest rates on 1-year tenure currently.
- Jana Small Finance: Go Small Finance Bank is offering 7.25% interest on 1 year FD.
- Ujjivan Small Finance Bank: Ujjivan Small Finance Bank is offering 7.25% return on 1 year FD to general customers.
You can make FD up to Rs 3 crore in all these banks.
When is TDS deducted on FD?
Many people have this misconception that the interest received on FD is always taxable. But actually the bank deducts TDS only when your total interest income from FD of any one bank exceeds Rs 1 lakh. TDS is not a separate tax, you can get it back as adjustment or refund while filing ITR.
Can TDS be saved by giving Form 15G?
Yes, but two conditions are necessary for this. Your total tax liability should be NIL. The income on which you do not want to deduct TDS should be less than the basic exemption limit.
Basic Exemption Limit
In the old tax system, there is a rebate of up to Rs 2,50,000, while in the new tax system there is a rebate of up to Rs 4,00,000. For example, if your total income attracts NIL tax, but FD interest is more than Rs 4 lakh (new tax regime), then you cannot submit Form 15G. According to experts, Form 15G is not allowed only because of NIL tax liability, but both the conditions should be fulfilled.
Disclaimer: This is not an investment advice but just an information. Consult your financial advisors before taking any decision related to money.
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