A person who wants a tax rebate under section 80C of Income Tax Act along with a guaranteed return should invest in tax saving fixed deposits. Why should I not invest in Tax Saver Fixed Deposit?
Other instruments offering more returns are available like PF, PPF, ELSS for investment of Rs 1.5 Lakh to claim tax rebate u/s 80C, it has a lock-in period is 5 years and the interest earned is also taxable & tax will deducted at source on interest earned if the interest is over Rs10000 in a financial year.
There are 2 options to open tax saving FDs. Either you can open an account online or visiting a bank branch. Which bank should I choose for tax saving FD? As different banks offer different interest rates on tax-saving FDs, you can compare them and choose the best before making an investment.
No, tax-saving fixed deposits are risk-free. Investment in FDs upto Rs 100000 is completely protected. Moreover, the returns are also guaranteed.
The minimum investment that can be made in a tax-saving fixed deposit is Rs 100 while the maximum is Rs 1.5 lakh in a financial year.
Tax-saving fixed deposit has a lock-in period of 5 years and premature withdrawal is also not allowed.
Indian citizens, HUFs and NRIs can invest in tax-saving fixed deposits.
On maturity of your tax saving FD, the maturity amount will be directly credited to your bank account.
Tax-saving fixed deposits can be transferred from one branch to another branch of the same bank.
No, loan cannot be given by pledging tax saving Fixed Deposits.