For calculating TDS, deposits across various branches of the same bank are taken into account. This means on a deposit of nearly Rs 6 lakh by a non-senior citizen, at an assumed interest rate of about 7 percent per annum, the annual interest earned will not be subject to TDS. For the current FY 2019-20, the limit stands at Rs 40,000 and Rs 50,000 for seniors. For the previous year 2018-19, the limit was Rs 10,000 and for seniors citizens it was Rs 50,000. The bank is liable to deduct TDS if the interest earned during the financial year exceeds a certain limit. However, banks are required to deduct tax at source (TDS) on the interest earned on FDs before paying it to the FD holder. The total tax liability of the individual will be determined accordingly and one may or may not be liable to pay taxes. The interest earned from FDs is fully taxable and one is supposed to show it under ‘Income from other sources’ while computing one’s gross income for the year. How to fill Form 15G: It is that time of the year when most fixed deposit holders make a dash to their banker.
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