Great thanks in advance. I was very confused about tds on interest of term deposits. So my question is, now tax on interest is calculated per branch over Rs.10,000 earned as interest. So if I have term depends in 2 or 3 banks, then if I can save TDS. Or all the interests will combine, as I submit PAN no in all accounts.
One more concern if interest is calculated for TDS in combine on savings account, rd and FD?
Sachin-First quest yourself whether escaping from TDS means escaping from paying tax? It is misconception among many Indians that if there is no TDS then no need to pay tax. But the reality is, interest on FDs are taxable according to one’s tax slab (whether TDS done or not). I know that a branch of a bank may not deduct TDS if your interest income for that year not more than Rs.10,000. But it does not mean that this interest is tax-free.
For savings account, up to Rs.10,000 interest earned is tax-free. If it is more than that then it will be taxable. Whereas, for FDs and RDs, there may not be TDS up to the limit of interest income of Rs.10,000. But even if you earn Rs.1 as an interest from both or either of one, then it will be taxable income for you.
Hence, don’t think of avoiding TDS. Instead think of taxability on such FDs, RDs or Savings Account.
Thanks, so basically it means, if my yearly income is under 2.5 lakhs, still TDS will be deducted, but i can file a redund for that.