Fd interest

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Akhil Jain (Querist)
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25 June 2013 I have a interest income on FD of about
Rs. 2,70,000/- Is there any rebate of Rs.10000 off on Interest Income or how can I save tax on the above income.

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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25 June 2013 The said exemption is in respect of Savings Bank Interest and not FD Interest.

For giving additional income tax deduction on Interest on Saving Bank Account new section 80TTA under Income Tax Act,1961 was introduced through Finance Act, 2012. This additional deduction u/s 80TTA is applicable only to individual and HUF on interest income from bank saving account .i.e this deduction is not applicable on interest received on time deposit/term deposit.

Eligible Assessee for section 80TTA: only Individual and HUF are elegible under this section, so a firm, an association of persons or a body of individuals will not get the benefit of this section.

Deduction Limit/ Maximum Deduction under Section 80TTA: Rs 10,000/- or actual interest receipt from saving bank account , which ever is lower. Example1. if person receive interest of Rs 15000/- from saving bank account then he has to pay tax on Rs 5000/- and Rs 10,000/- he can claim as deduction u/s 80TTA. Example2. if person receive interest of Rs 9000/- from saving bank account then he don’t have to pay tax on Rs 9000/- and Rs 9,000/- can be claimed as deduction u/s 80TTA.

Akhil Jain

Akhil Jain (Querist)
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25 June 2013 Thanks for the help.

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