Income Tax on Interest Income

Interest-bearing investments such as savings accounts, fixed deposits, and recurring deposits are go-to options for risk-averse investors. Just like any other income, interest income also attracts income tax. Interest income from these investments is taxable as income from other sources. Lets take a look at some of the most popular interest-bearing investments and how they are taxed in India-

Savings Bank Account – Interest Income

Every quarter bank credits interest to your savings account. Interest that gets accumulated in your savings bank account is considered as your taxable income under the head “Income From Other Source.” And it must be declared in your tax return. Saving account interest is taxable at your slab rate. Do note that bank does not deduct TDS on savings bank interest. While incomes from the fixed deposit and recurring deposit are taxable, interest from the savings bank account and post office deposits are tax-deductible to a certain extent.

How is savings interest taxable?

  • The interest component which is earned on saving account is considered as ‘Income from other Sources’.
  • This interest income will be declared in your Income Tax Return and will be taxable as per the applicable slab rate.
  • As per Section 19A of the Income Tax Act, 1961, TDS is not to be deducted on interest on a savings account.
  • For NRIs, tax is deducted at source (TDS) at 30% on interest on Non-Resident ordinary accounts. No tax applies to interest on Non-resident External (NRE) accounts.
  • Savings interest income of up to INR 10,000 in a financial year is eligible for tax deduction under Section 80TTA of the IT Act.
  • Interest on a savings account up to INR 10,000 is technically treated as a deduction. For example, if your gross total income is INR 10 lakh and you have savings account interest of INR 25,000 a deduction of INR 10,000 will be made from your gross total income.

Deduction Under Section 80TTA

Section 80TTA of the Income Tax Act was introduced in order to allow a deduction of up to INR 10,000 on savings interest. 80TTA deduction was introduced to encourage taxpayers to generate more savings. It is available to individuals and HUFs other than senior citizens.  Section 80TTB is applicable in the case of a senior citizen.

If interest income from all the saving accounts is less then INR 10,000 then the entire amount is deductible. If total interest from saving accounts exceeds INR 10,000 then the maximum of INR 10,000 will be deductible and the remaining amount will be taxable

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FD Interest Income

Fixed deposits have been a popular investment option for many investors, it allows you to exploit complete potential of Section 80C to deduct ₹1.5 lakh from your taxable income. However, interest received on FD is taxable. Income tax on interest on fixed deposit is chargeable under the head ‘Income from Other Sources‘. Hence, the income is added to the total income of the taxpayer.

How is Interest Income from Fixed Deposit Taxable?

Interest received from Fixed Deposits is fully taxable and the tax liability is as per the income tax slab. Add it to your total income under the head ‘Income from Other Sources’ in your Income Tax Return. Tax is Deducted at Source by the bank at the time they credit the interest to your account, and not when the FD matures. You will receive the amount net of tax. You then have to add the gross amount to your income and adjust TDS against your final tax liability.

How income tax on interest on Fixed Deposit is calculated?

Many taxpayers got messages and emails from Income Tax Department regarding a mismatch in the interest income data available with the tax department and what was shown in the Income Tax Return (ITR) filed by taxpayers. Therefore you need to add your interest income to your total income and calculate your tax liability accordingly to avoid any such notices. You can follow the following steps to calculate tax liability on interest on FD to your ITR:

  • Add the interest income under the head Income From Other Sources.
  • See which tax slab rate you fall into.
  • Match it with the yearly TDS deduction in your Form 26AS.
  • Bank does not deduct TDS for annual FD interest below INR 40,000
  • The Income Tax Department will adjust the TDS (which has already been deducted) against your final tax liability.
  • Even when no TDS is deducted include the interest income in your total income and pay tax on it.

Suppose you wait until the maturity of your FD when interest is actually received– your total interest income may push you up to a slab and you may end up paying the higher tax.

Let us understand this by way of an example:

Anish falls in the 20% tax bracket. He has 2 FDs with a bank of INR 1,00,000 each for a period of 3 years at 8% interest per annum. In the first year, Anish’s interest income is INR 8,000 from each of the FDs, total interest accrued is INR 16,000 in the first year. Bank does not deduct TDS for annual FD interest below INR 40,000.

Another example: Arjun has a fixed deposit of INR 8 lakh at an interest rate of 8% p.a. He receives an annual interest of INR 64,000. The bank deducts TDS on the whole of INR 64,000. The prescribed rate of TDS is 10%. However, for the FY 2020-21 (from 14 May till 31 March 2021) the TDS is deductible at 7.5%.

When to pay income tax on interest on Fixed Deposit?

If there is any tax liability after the inclusion of your interest income in your total income tax on that should be paid before 31st March of that FY i.e. before the end of the Financial Year. You may also be liable to pay quarterly advance tax, if your total tax liability is more than INR 10,000

ITR Form to File to Report Income from FD Interest

Taxpayers must file ITR 1 and report the income from FD interest under the income from other sources head. This is in the case where the taxpayer is only receiving income from FD interest.

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Check which ITR Form to file?
Income Tax Return Forms to file depends on your Income Source, Residential Status, and other financial situation. Know which ITR Form you should file.
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TDS in relation to FDs

  • When does the bank not deduct TDS
    • If total interest income from all FDs with a bank is less than INR 40,000 in a year, the bank cannot deduct any TDS.
    • The limit is INR 50,000 in case of a senior citizen aged 60 years and above.
    • Prior to Budget 2019, the limit of TDS on interest income was INR 10,000.
  • When does the bank deduct TDS @ 10%
    • When the interest income for the year from all the FDs with the bank exceeds INR 40,000 (INR 50,000 in the case of senior citizens) there would be a 10% TDS deduction from such interest income .
  • The TDS Deduction will be 20% if you don’t provide your PAN to the particular bank. So do make sure that the bank has your PAN details.
  • However, if your income is below the exempted limit, you can file Form 15G/15H to avoid TDS. Form 15H for senior citizens and 15G is for other than senior citizens. Submit these forms at the beginning of each financial year to avoid additional TDS deduction and subsequent refund from the IT Department.

Interest Income of senior citizens

Senior citizens receiving interest income from FDs, savings account and recurring deposits can claim a deduction of up to ₹50,000 annually under Section 80TTB. If the senior citizen’s interest income from all FDs with a bank is less than ₹50,000 in a year, the bank cannot deduct any TDS.

FAQ

How will I receive the interest amount?

If you have deposited your money under the traditional scheme, the interest is credited to the given Savings Account on a monthly or quarterly basis.
If you have opted for the reinvestment scheme, a compounded interest is added to the principal amount every quarter and this is reinvested.
You can choose to receive the interest amount on a monthly, quarterly or annual basis.

What is the exemption limit for FD?

If an individual opts for old/existing tax regime, then under Section 80C of the Income-tax Act, you can claim deduction for investments up to INR 1.5 lakh in a financial year by investing in tax-saving fixed deposits (FDs)

How much money can I lock in a Fixed Deposit?

The lower limit and upper limit vary according to the bank.

RBL Bank Fixed Deposit (FD) Interest Rate

RBL Bank is one of the India’s fastest growing private sector bank. Founded in 1943, they provide various personal, business and wholesale banking products and services. Fixed deposits are a popular investment product as they provide tax benefit under section 80C of the Income Tax Act. In this article we will discuss RBL Bank Fixed Deposit interest rates.

RBL Bank Fixed Deposit Interest Rates

The following are the RBL Bank fixed deposit interest rate for deposits of up to 3 crores for General and Senior Citizens:

Tenure Interest Rates for General Citizens Interest Rates for Senior Citizens
7 days to 14 days 3.25% 3.75%
15 days to 45 days 4.00% 4.50%
46 days to 90 days 4.75% 5.25%
91 days to 180 days 5.25% 5.75%
181 days to 240 days 5.75% 6.25%
241 days to 364 days 5.75% 6.25%
12 months to less than 24 months 6.50% 7.00%
24 months to less than 36 months 6.50% 7.00%
36 months to 36 Months 1 Day 6.75% 7.25%
36 months 2 Days to less than 60 months 6.25% 6.75%
60 months to less than 120 months 6.25% 6.75%
120 months to 240 months 6.25% 6.75%
Tax Savings Fixed Deposit (60 months to less than 120 months) 6.25% 6.75%

As we can can see from the above table, senior citizens enjoy 0.5% more interest than general citizens on RBL Bank fixed deposit.

Premature Withdrawals of RBL Bank Fixed Deposit

Category of the deposits Penalty on premature withdrawal of the deposit
Fixed deposit of senior citizens NIL
Fixed deposit of general citizens 1%

Tax Benefit on RBL Bank Fixed Deposit

Tax Deducted at Source under section 194A is deducted at the rate of 10% on the RBL Bank FD interest if the total interest income during the financial year exceeds INR 40,000. On the other hand, this limit is INR 50,000 for senior citizens.

To claim exemption from TDS, FD holders may declare that the tax on total income earned is zero by submitting Form 15H for senior citizens and Form 15G for other taxpayers.

Eligibility Criteria to open RBL Bank FD

The following are eligible to open a Fixed Deposit account with RBL Bank:

Documents required to open RBL Bank FD

Investors need to submit the following documents to open a FD Account with the RBL Bank:

  • Identity Proof
    • Aadhar Card
    • PAN Card
    • Passport
    • Driving License
    • Election Card
  • Residential Proof
    • Telephone Bill
    • Electricity Bill
    • Passport
  • Income Proof
    • ITR-V – Income Tax Return Acknowledgment
    • Form 16 from employer
    • Salary Slip/Certificate
    • Bank Statement
    • Job card issued by NREGA
  • Passport-sized Photograph

FAQs

Can a NRI invest in RBL Bank FD scheme?

Yes, they can. The same interest rates as mentioned in the article above will be applicable however, minimum tenure for them will be 1 year.

Can I invest more than 3 cr. in RBL Bank FD?

Yes, you can. However, you will have to connect with your nearest RBL Bank branch for the same.

What is the maximum amount I can invest in RBL Bank Tax Savings Fixed Deposit?

A maximum amount of INR 150,000 can be invested in 5-year Tax Saving FD scheme.

Bank of India Fixed Deposit (FD) Interest Rates

Bank of India (BOI) is an Indian commercial bank founded in 1906 and nationalized in 1969. They have over 3 lakh employees and are focused on blending traditional values and ethics with modern infrastructure.

Bank of India Fixed Deposit Interest Rates

The following are Bank of India FD interest rates for various tenures:

Tenure Interest rates for amount <INR 2 Cr. Interest rates for amount >INR 2 Cr. to <INR 10 Cr. Interest rates for amount INR 10 Cr. and above
7 to 14 days 3.25% 3.00% 2.75%
15 to 30 days 3.25% 3.00% 2.75%
31 to 45 days 3.25% 3.00% 2.75%
46 to 90 days 4.25% 3.20% 2.75%
91 to 179 days 4.25% 3.25% 2.75%
180 days to 269 days 4.75% 3.25% 2.90%
270 days to less than 1 year 4.75% 3.25% 2.90%
1 Year & above but less than 2 Yrs 5.25% 3.50% 3.00%
2 years & above to less than 3 years 5.30% 3.50% 3.00%
3 years & above to less than 5 years 5.30% 3.50% 3.00%
5 years & above to less than 8 years 5.30% 3.50% 3.00%
8 years & above to 10 years 5.30% 3.50% 3.00%

Bank of India offers 0.50% higher FD interest rates for senior citizens than for the general citizens for minimum deposit of INR 5000. 

Premature Withdrawals of Bank of India Fixed Deposit

Bank of India provides the facility of premature withdrawals but they charge the following penalty for the same:

Category of the deposits Penalty on premature withdrawal of the deposit
Deposits less than INR 5 Lacs withdrawn on or after completion of 12 months
NIL
Deposits less than INR 5 Lacs withdrawn prematurely before completion of 12 months 0.50%
Deposits of INR 5 Lacs & above withdrawn prematurely 1.00%

Tax Benefit on Bank of India Fixed Deposit

Not only do Fixed Deposits provide good returns on savings but it also provides tax benefit by reducing tax liability under section 80C of the Income Tax Act.

Tax Deducted at Source under section 194A is deducted at the rate of 10% on the Bank of India FD interest if the total interest income during the financial year exceeds INR 40,000. On the other hand, this limit is INR 50,000 for senior citizens.

To claim exemption from TDS, FD holders may declare that the tax on total income earned is zero by submitting form 15H for senior citizens and Form 15G for other taxpayers.

Eligibility to open Bank of India FD Account

Term Deposit accounts may be opened in the names of the following

  • Residential Individual
  • Two or more individuals – Joint FD Account
  • Sole Proprietary Company
  • Partnership Firms
  • Blind Persons
  • Minors with adult co-signatories
  • Limited Companies
  • Associations, Clubs and Societies
  • Trusts
  • Hindu Undivided Family
  • Municipality
  • Government and Quasi-Government Bodies
  • Religious, Educational and Charitable Institutions

Documents required to open a Bank of India FD Account.

Investors need to submit the following documents to open a FD Account with the Bank of India:

  • Identity Proof
    • Aadhar Card
    • PAN Card
    • Passport
    • Driving License
    • Election Card
  • Residential Proof
    • Telephone Bill
    • Electricity Bill
    • Passport
  • Income Proof
    • ITR-V – Income Tax Return Acknowledgment
    • Form 16 from employer
    • Salary Slip/Certificate
    • Bank Statement
    • Job card issued by NREGA
  • Passport-sized Photograph

FAQs

Can NRIs invest in Bank of India Fixed Deposit scheme?

Yes, they can invest through their NRO or NRE bank accounts.

When does Bank of India pay interest accrued in Fixed Deposit?

Bank of India pays interest half yearly on 1st October and 1st April. In case, these dates fall on holidays then the interest is paid on the next working day.

What is the maximum amount and tenure for Bank of India fixed deposit scheme?

An investor can invest up to INR 10 Cr. in Bank of India fixed deposit scheme for a maximum of 10 years.

Axis Bank Fixed Deposit (FD) interest rates

Axis bank is one of the first new generation bank that began their operations in 1994. It is one of the third largest private sector bank in India. Axis bank provides number of financial services to customers ranging from large-mid cap companies, MSME, retail and agriculture business. This article covers Axis Bank FD interest rates.

Interest rates for Fixed deposit in Axis Bank

Following are the Axis Bank FD interest rates:

Tenure FD Interest Rates for General Citizens FD Interest Rates for Senior Citizens
7 days – 14 days 2.50% 2.50%
15 days – 29 days 2.50% 2.50%
30 days – 45 days 3.00% 3.00%
46 days – 60 days 3.00% 3.00%
61 days – 3 months 3.00% 3.00%
90 days – 119 days 3.50% 3.50%
4 months – 5 months 3.50% 3.50%
5 months – 6 months 3.50% 3.50%
6 months – 8 months 29 days 4.40% 4.65%
9 months – 11 months 25 days 4.40% 4.65%
11 months 25 days – 1 year 5.15% 5.40%
13 months – 17 months 29 days 5.10% 5.75%
18 months – 2 years 5.25% 5.90%
30 months 1 day – 3 years 5.40% 5.90%
1 year – 1 year 5 days 5.15% 5.80%
1 year 5 days – 1 year 11 days 5.10% 5.75%
1 year 11 days – 1 year 25 days 5.10% 5.75%
1 year 25 days – 12 months 29 days 5.10% 5.75%
2 years – 30 months 5.40% 6.05%
3 years – 4 years 364 days 5.40% 5.90%
5 years – 10 years 5.50% 6.00%

Additionally, Axis bank FD investor is eligible to avail a loans up to 85% of FD’s value against their Axis Bank Fixed Deposits.

Eligibility Criteria for Axis Bank FD account

Following are the people who are eligible for Axis Bank FD account opening:

Documents required for Axis Bank Fixed Deposit (FD) account:

Documents requirement differ for every individual and legal body. Following are the requirements based on type of entity.

Individuals, HUFs, and sole proprietorship firms when applying for a Fixed Deposit in Axis Bank:

  • Drivers license
  • PAN
  • Passport
  • A photograph
  • An introduction by any other bank or an introduction by an Axis Bank Savings Account holder for the last six months

Trusts when applying for a Fixed Deposit Axis Bank:

  • Copy of the Trust Deed
  • Copy of the Registration Certificate
  • Photographs of all the members operating the account
  • Copy of the Resolution of Trustees authorizing the members concerned to open and operate the account

Partnership firms when applying for a Fixed Deposit in Axis Bank:

  • Partnership Deed
  • Photographs of all the persons operating the account
  • Letter from partners approving the persons concerned to open and operate the account

FAQs

What is the minimum amount required to invest in Axis bank FD?

An investor can open a fixed deposit account in Axis bank and begin the investment with as low as INR 5000.

Is interest received on Fixed deposit subject to tax?

Yes, interest earned on tax saving fixed deposits are taxable and are subject to TDS.

How can I open a Axis Bank FD account?

A customer can open Axis Bank FD account by applying through mobile banking, internet banking or by visiting the nearest Axis bank branch.

ICICI Bank Fixed Deposit (FD) Interest Rates

ICICI Bank is a private sector bank in India. The bank has total assets of INR 14.76 trillion has a network of 5200+ branches and 15,158 ATMs across India. The bank offers a variety of fixed deposit schemes and other services based on customer’s investment requirements to help them save tax and grow their wealth safely. In this article we take a look at the ICICI Bank FD interest rates

Interest rates for Fixed deposit in ICICI Bank

Following are the FD interest rates that the ICICI bank offers:

Tenure Interest rate for General citizen investing <INR 2 cr Interest rate for Senior citizen investing <INR 2 cr Interest rate for General citizen investing >INR 2 cr to <INR 5 cr Interest rate for Senior citizen investing >INR 2 cr to <INR 5 cr
7 days to 14 days 2.50% 3.00% 2.50% 2.50%
15 days to 29 days 2.50% 3.00% 2.50% 2.50%
30 days to 45 days 3.00% 3.50% 2.75% 2.75%
46 days to 60 days 3.00% 3.50% 2.75% 2.75%
61 days to 90 days 3.00% 3.50% 3.00% 3.00%
91 days to 120 days 3.50% 4.00% 3.00% 3.00%
121 days to 184 days 3.50% 4.00% 3.00% 3.00%
185 days to 210 days 4.40% 4.90% 3.50% 3.50%
211 days to 270 days 4.40% 4.90% 3.50% 3.50%
271 days to 289 days 4.40% 4.90% 3.65% 3.65%
290 days to less than 1 year 4.40% 4.90% 3.65% 3.65%
1 year to 389 days 4.90% 5.40% 3.75% 3.75%
390 days to < 18 months 4.90% 5.40% 3.75% 3.75%
18 months days to 2 years 5.00% 5.50% 3.90% 3.90%
2 years 1 day to 3 years 5.15% 5.65% 4.30% 4.30%
3 years 1 day to 5 years 5.35% 5.85% 4.30% 4.30%
5 years 1 day to 10 years 5.50% 6.30% 4.30% 4.30%
5 Years (80C FD) – Max to ₹1.50 lac 5.35% 5.85% NA NA

Note:

  • NRE rates are applicable only for FDs with 1+ year tenure
  • Senior citizen rates are applicable only on domestic term deposits

Moreover, investors can avail a loan of up to 90% of FD’s value against their ICICI fixed deposit.

Special Forms to fill when Applying for ICICI Bank Fixed Deposit

The investment objective of fixed deposits is to provide tax benefits under section 80C of the Income tax Act. It motivates an individuals to save their wealth and also reduces tax liability.

In order to avail those tax benefits, an investor has to fill Form 15G and Form 15H respectively before investing. Additionally, ICICI bank also provides facility of submitting 15H and 15G via net banking or ICICI’s mobile app.

However, investors should keep in mind that they will get tax exemptions only if their interest earnings are not above the specific tax slab determined by the Income Tax Department.

Eligibility Criteria

  • Indian Citizen
  • Trusts
  • Sole proprietary companies
  • HUF
  • Partnership firm
  • Limited companies

Documents required for ICICI Bank Fixed Deposit (FD) account:

  • Proof of Identity
    • PAN
    • Aadhaar
    • Passport
    • Driver’s license
    • Senior Citizen id
    • Voter id
    • Government ID card
    • Photo ration card
  • Proof of Address
    • Electricity bill
    • Telephone bill
    • Bank statement along with a cheque
    • Passport

FAQs

What is the minimum amount required for investing in ICICI Fixed Deposit?

An investor can open a fixed deposit account and begin the investment with as low as INR 10,000. However, minors can begin investing in ICICI FD with INR 2000.

How do I open a ICICI FD account?

An individual can open a ICICI FD account by using ICICI online banking portal or by visiting the nearest ICICI bank branch.

Is interest received on Fixed deposit subject to tax?

Yes, interest earned on tax saving fixed deposits are taxable and are subject to TDS.

Central Bank of India Fixed Deposit (FD) Interest Rates

Central Bank of India is a public sector banking institution which is one of the oldest and largest commercial banks in India. They have pan India presence with 63% of the branches in rural and semi-urban areas. They offer wide range of products and services. We will be discussing Central Bank of India Fixed Deposit (FD) interest rates in this article.

Central Bank of India FD Rates

Central Bank of India offers different interest rates for fixed deposit of less than INR 2 Cr. and fixed deposit of between INR 2 Cr. and INR 10 Cr.

Tenure Interest rates for amount <INR 2 Cr. Interest rates for amount >INR 2 Cr. to <INR 10 Cr.
7 to 14 days 2.75% 2.75%
15 to 30 days 2.90% 2.75%
31 to 45 days 2.90% 2.75%
46 to 59 days 3.25% 2.75%
60 to 90 days 3.25% 2.75%
91 to 179 days 3.90% 2.75%
180 to 270 days 4.25% 3.00%
271 to 364 days 4.25% 3.25%
1 year to less than 2 years 4.90% 3.50%
2 years to less than 3 years 5.00% 3.50%
3 years to less than 5 years 5.10% 3.50%
5 years to less than 10 years 5.10% 3.50%

Remarkable features of Central Bank of India Fixed Deposit

Central Bank Fixed Deposit holders can avail the following the benefits:

  • A wide range of tenure from 7 days to 10 years available
  • The minimum deposit amount to open a Central Bank of India FD is only INR 100
  • A nomination facility is provided by the bank so the FD holder can nominate their family members or spouse to collect the maturity amount
  • Central Bank of India Fixed Deposit investors can customize interest payments like Monthly/Quarterly and reinvestment of interest as per their need
  • Central Bank FD holders can also avail auto-renewal facility on their deposits
  • Loan of up to 90% of the FD’s principal and accrued interest can be availed by the Central Bank Fixed Deposit holders.

Premature Withdrawals of Central Bank of India Fixed Deposit

Payment before maturity will be available as per the following rules:

  • Premature withdrawal of fixed deposit up to INR 5 Lakhs: No Penalty
  • Premature withdrawal of fixed deposit of more than INR 5 Lakhs: Interest Penalty at 1% will be charged

Tax Benefit on Central Bank of India Fixed Deposit

Not only do Fixed Deposits provide good returns on savings but it also provides tax benefit by reducing tax liability under Section 80C of the Income Tax Act.

Tax Deducted at Source under Section 194A is deducted at the rate of 10% on the Central Bank of India FD interest if the total interest income during the financial year exceeds INR 40,000. On the other hand, this limit is INR 50,000 for senior citizens.

To claim exemption from TDS, FD holders may declare that the tax on total income earned is zero by submitting Form 15H for senior citizens and Form 15G for other taxpayers.

Eligibility Criteria to open Central Bank of India FD Account

The following are eligible to open a Fixed Deposit account with Central Bank of India.

Documents required to open a Central Bank of India FD Account

Investors need to submit the following documents to open a FD Account with the Central Bank of India:

  • Identity Proof
    • Aadhar Card
    • PAN Card
    • Passport
    • Driving License
    • Election Card
  • Residential Proof
    • Telephone Bill
    • Electricity Bill
    • Passport
  • Income Proof
    • ITR-V – Income Tax Return Acknowledgment
    • Form 16 from employer
    • Salary Slip/Certificate
    • Bank Statement
    • Job card issued by NREGA
  • Passport-sized Photograph

FAQs

What does reinvestment or cumulative interest mean in Fixed Deposit?

Interest is compounded quarterly and reinvested with the principal amount in reinvestment or cumulative interest plans.

How can I get my Central Bank of India FD certificate?

You will have to visit your nearest Central Bank of India branch to obtain the Fixed Deposit certificate. It cannot be availed online.

What is the minimum tenure for a Tax saving deposit with Central Bank of India?

A fixed term of 5 years is required in the Tax saving fixed deposit scheme.

SBI Fixed Deposit (FD) Interest Rates

State Bank of India (SBI) is the oldest Indian multinational, public-sector banking and financial institute. It is the largest Indian bank at the moment in terms of total assets and market capitalization. It has established roots globally with 191 foreign offices spread across 36 countries. SBI offers various fixed deposit schemes with a different tenure and interest rates. In this article, we will look at SBI fixed deposit (FD) interest rates.

Types of SBI Fixed Deposit Schemes

State Bank of India has various types of Fixed Deposit Schemes to fulfil the demands of its versatile customer base:

  • SBI Term Deposit Scheme:
    • With maturity ranging from 7 days to 10 years and minimum investment of INR 1,000
  • Tax Saving SBI Fixed Deposit Plan:
    • The investment tenure is fixed for 5 years and the maximum investment amount is INR 1.5 Lakhs
  • SBI Fixed Deposit Reinvestment Plan:
    • The maturity tenure ranges from 6 months to 10 years. Minimum investment requirement is only INR 1,000. The interest accrued on this plan is reinvested into the same plan to get higher interest
  • SBI Multi Option Deposit Plan:
    • With tenure ranging from 1 to 5 years and a minimum investment requirement of INR 10,000. The benefit of this plan is that it is a combination of savings bank account and fixed deposit. Hence, the investors can withdraw the sum partially while the rest of the deposit can continue earning interest
  • SBI Annuity Deposit:
    • The tenure options include 36, 60, 84 and 120 months with a minimum investment of INR 25,000. Early withdrawals are only possible in the case of a death of the investor

SBI Fixed Deposit Interest Rates

Tenure FD Interest Rates for General Citizens FD Interest Rates for Senior Citizens
7 days to 45 days 2.90% 3.40%
46 days to 179 days 3.90% 4.40%
180 days to 210 days 4.40% 4.90%
 211 days to 1 year 4.40% 4.90%
1 year to less than 2 years 5.00% 5.50%
2 years to less than 3 years 5.10% 5.60%
3 years to less than 5 years 5.30% 5.80%
5 years and up to 10 years 5.40% 6.20%

 

SBI Term wise FD interest rates

SBI fixed deposits can be further categorized as short-term, medium-term and long-term depending on tenure.

  • Short-term Fixed Deposit:
    • SBI FD interest rate for tenure ranging from 7 days to 365 days range from 2.90% to 4.40% p.a.
    • As for senior citizens, short-term interest rates range from 3.40% p.a. to 4.90% p.a. These deposits are know as short-term as the tenure is less than 1 year
  • Medium-term Fixed Deposit
    • These type of deposits have tenure ranging from more than 1 year to less than 5 years
    • SBI FD interest rates ranges from 5.00% to 5.30% p.a. for general citizens and 5.50% to 5.80% p.a. for senior citizens
  • Long-term Fixed Deposit:
    • The tenure for these type of deposits range from 5 years to 10 years. It offers an interest rate of 5.40% and 6.20% for senior citizens

Interested fixed deposit holders can also calculate SBI FD interest rate using the investment amount, maturity amount and tenure.

Distinctive features of SBI Fixed Deposit

  • A wide range of tenure from 7 days to 10 years available for SBI FD
  • There is no limit on the maximum deposit amount while the minimum deposit amount to open a SBI FD is only INR 1,000
  • The SBI FD interest rates are 0.50% higher for senior citizens. Moreover, they can also avail 0.25% extra interest rate if their fixed deposit amount exceeds INR 10,000
  • A nomination facility is provided by SBI so the FD holder can nominate their family members or spouse to collect the maturity amount
  • SBI FD investors can customize interest payments like monthly/ quarterly and calendar quarter basis as per their need
  • SBI FD holders can also avail auto-renewal facility on their deposits
  • Loan of up to 90% of the FD’s outstanding value can be availed by the SBI FD holders. Interest is charged between 5.5% to 7.1% on this loan.

Tax Benefit on SBI Fixed Deposit

The investment objective of fixed deposits is to provides tax benefit under Section 80C of the Income tax Act. It motivates an individuals to save their wealth and also reduces tax liability.

Tax Deducted at Source under Section 194A is deducted at the rate of 10% on the interest received on SBI FD if the accumulated interest amount exceeds INR 40,000 in a financial year. On the other hand, this limit is INR 50,000 for senior citizens.

To claim exemption from TDS, FD holders may declare that the tax on total income earned is zero by submitting Form 15H for senior citizens and Form 15G for the rest.

Eligibility Criteria to open SBI FD

Listed below are the various entities that are eligible to open an SBI Fixed Deposit:

  • Residential Individuals
  • NRIs and NRE/NRO Account holders
  • Minors with parents/ guardians as co-signatories
  • Partnership Firms
  • HUF
  • Society, Clubs and Agencies
  • Sole proprietorship business
  • Educational and charitable institutes

Documents required to open SBI FD Account

New State Bank of India customers need to submit the following documents to open a FD Account:

  • Identity Proof
    • Aadhar Card
    • PAN Card
    • Passport
    • Driving License
    • Election Card
  • Residential Proof
    • Telephone Bill
    • Electricity Bill
    • Passport
  • Income Proof
  • Age proof of Senior citizens and Minor
    • Birth Certificate
    • Matriculation certificate
    • Senior Citizen ID
  • Passport-sized Photograph

However, existing customers of SBI do not need to submit any additional documents to open a fixed deposit account as they can simply log into Net Banking and open a FD. 

FAQs

What is the minimum amount that one needs to deposit to open a FD account with SBI?

For the basic scheme, the minimum deposit required is INR 1,000. However, for SBI Multi Option the minimum is INR 10,000 while for SBI Annuity Scheme is INR 25,000.

How long does FDs take to mature?

FD maturity varies between 7 days to 10 years. The investor may chose a maturity date according to their investment goals.

What is a non-callable FD?

A FD scheme that prevents a customer from withdrawing any amount before the maturity of the fixed deposit is called a non-callable FD.

HDFC Bank Fixed Deposit (FD) interest rates

HDFC Bank is the first bank to get approval from RBI to set up a private sector bank in 1994. HDFC banking and financial service is the largest bank in India based on its market capitalization. It has  5400+ branches & 13,500 ATMs across the country. Out of all the financial services it provides, HDFC fixed deposit account service is very popular among the Indian crowd. The bank offers them a variety of fixed deposit schemes and other services based on their investment requirements to help them save tax and grow their wealth safely. In this article we take a look at the fixed deposit rates of the HDFC bank.

Interest rates for Fixed deposit in HDFC Bank

Following are the fixed deposit rates that the HDFC bank offers:

Tenure Interest rate for General citizen investing <INR 2 cr Interest rate for Senior citizen investing <INR 2 cr Interest rate for General citizen investing >INR 2 cr to <INR 5 cr Interest rate for Senior citizen investing >INR 2 cr to <INR 5 cr
7 – 14 days 2.50% 3.00% 2.50% 3.00%
15 – 29 days 2.50% 3.00% 2.50% 3.00%
30 – 45 days 3.00% 3.50% 2.75% 3.25%
46 – 60 days 3.00% 3.50% 2.75% 3.25%
61 – 90 days 3.00% 3.50% 3.00% 3.50%
91 days – 6 months 3.50% 4.00% 3.00% 3.50%
6 months 1 days – 9 months 4.40% 4.90% 3.50% 4.00%
9 months 1 day < 1 Year 4.40% 4.90% 3.65% 4.15%
1 Year 4.90% 5.40% 3.75% 4.25%
1 year 1 day – 2 years 4.90% 5.40% 3.75% 4.25%
2 years 1 day – 3 years 5.15% 5.65% 4.25% 4.75%
3 year 1 day- 5 years 5.30% 5.80% 4.25% 4.75%
5 years 1 day – 10 years 5.50% 6.25% 4.25% 5.00%

Additionally, a domestic/ NRE/NRO fixed deposit investor of HDFC bank is eligible for earning HDFC FD credits. Using such credits, the bank approves a loan of up to 90% of the FD’s value.

However, in case of Foreign Currency non- repatriable fixed deposit investors loan up to only 70% of FD’s value is granted.  

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Special forms to fill when applying for HDFC bank Fixed deposit

The investment objective of fixed deposits is to provide tax benefits under section 80C of the Income tax Act. It motivates an individual to save their wealth and also reduces tax liability.

In order to avail those tax benefits, an investor has to fill Form 15G and Form 15H respectively before investing. However, investors should keep in mind that they will get tax exemptions only if their interest earnings are not above the specific tax slab determined by the Income Tax Department.

Eligibility Criteria

  • Indian Citizen
  • Trusts
  • Sole proprietary companies
  • HUF
  • Partnership firm
  • Limited companies

Documents required for HDFC Bank Fixed Deposit (FD) account:

  • Proof of Identity
    • PAN
    • Aadhaar
    • Passport
    • Driver’s license
    • Senior Citizen id
    • Voter id
    • Government ID card
    • Photo ration card
  • Proof of Address
    • Electricity bill
    • Telephone bill
    • Bank statement along with a cheque
    • Passport

FAQs

What is the minimum amount required for investing in HDFC Fixed Deposit?

A investor can open a Fixed deposit account and begin the investment with as low as INR 5000.

Do senior citizen get any benefits of HDFC FD deposit?

Once provided with the documents to prove your age, HDFC offers 0.50% extra interest to depositors that are over 60 years. 

Can I change the maturity period of an on-going FD?

No, maturity of a Fixed deposit cannot be changed once it is initiated. If an investor wants to change the maturity period of a Fixed deposit he/she has to start a new investment with their preferred tenure.

What is a non-callable FD?

A FD scheme that prevents a customer from withdrawing any amount before the maturity of the Fixed Deposit is called a non-callable FD.

IDFC First Bank Fixed Deposit (FD) Interest Rates

The merger of IDFC Bank and Capital First in 2019 has created a new bank, namely, IDFC First Bank. It is built on the strength of both institutions and focusing on rural India and digital banking for continued growth in the future. Apart from this, they also offer Fixed Deposit (FD) schemes with varied tenure and interest rates

The most sought-after investment product offered by the Banks are Fixed Deposit schemes as they provide tax benefit under Section 80C of the Income Tax Act. It motivates an individuals to save their wealth and also reduces tax liability.

IDFC First Bank Fixed Deposit Scheme

Most importantly, IDFC First Bank offers a FD Scheme which allows individuals to deposit a part of their savings to create income with the following remarkable features:

  • Interests is compounded quarterly in the Fixed Deposit Account
  • No penalty for senior citizens for early withdrawal
  • Auto- renewal and nomination facilities

IDFC First Bank Fixed Deposit Interest Rates

The following table lists the IDFC First Bank FD interest rates for General and Senior Citizens for amount less than INR 2 crore.

Tenure

FD Interest Rates for General Citizens FD Interest Rates for Senior Citizens
7 days – 14 days 2.75% 3.25%
15 days – 29 days 3.00% 3.50%
30 days – 45 days 3.50% 4.00%
 46 days – 90 days 4.00% 4.50%
91 days – 180 days 4.50% 5.00%
181 days – less than 1 year 5.25% 5.75%
1 year – 499 days 5.75% 6.25%
500 days 6.00% 6.50%
501 days – 2 years 5.75% 6.25%
2 years 1 day – 5 years 5.75% 6.25%
5 years 1 day – 10 years 5.75%

6.25%

As is evident from above, a longer tenure attracts a higher rate of interest. Moreover, IDFC First Bank offers 0.50% higher FD interest rates for senior citizens than for the general citizens.  

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Eligibility Criteria to open IDFC First Bank FD

Listed below are the various entities that are eligible to open an IDFC First Bank FD:

Documents required to open IDFC First Bank FD

New IDFC First Bank customer need to submit the following documents to open a FD Account with IDFC First Bank:

  • Identity Proof
    • Aadhar Card
    • PAN Card
    • Passport
    • Driving License
    • Election Card
  • Residential Proof
    • Telephone Bill
    • Electricity Bill
    • Passport
  • Income Proof
  • Passport-sized Photograph

However, existing customers of IDFC First Bank do not need to submit any additional documents to open a Fixed Deposit account, they can simply log into Net Banking and open a FD. 

Tax Benefit on IDFC First Bank Fixed Deposit

The investment objective of fixed deposits is to provides tax benefit under Section 80C of the Income tax Act. It motivates an individuals to save their wealth and also reduces tax liability.

Tax Deducted at Source (TDS) under Section 194A is deducted at the rate of 10% on the interest received on IDFC First Bank FD if the accumulated interest amount exceeds INR 40,000 in a financial year. However, this limit is INR 50,000 for senior citizens.

To claim exemption from TDS, FD holders may declare that the tax on total income earned is zero by submitting Form 15H for senior citizens and Form 15G for the rest.

FAQs

Is it possible to open a fixed deposit of more than INR 2 crore in IDFC First Bank?

Yes, it is possible. You can approach your nearest IDFC First bank branch for more information.

What is the minimum amount that one needs to deposit to open a FD account with IDFC First Bank?

A minimum of Rs. 10,000 needs to be deposited in the IDFC First Bank Fixed Deposit (FD) Account to open an FD.

How long does FDs take to mature?

FD maturity varies between 7 days to 10 years. The investor may chose a maturity date according to their investment goals.