Long term tax saving fd in banks
This query is : Resolved
23 August 2011
Hello,
Suppose, I want to invest 50,000/- in long term tax saving FD in a nationalised bank. Can I avail 50,000 under sec.80c for the first year? and also 50,000 plus interest amount 4500 @9% in the next preceding year?
example : investment 50,000 + 4500 interest = 54500 first year.
54000+ again 4500 interst for second year..., and so on till 5th year?
thanks, KRishna
Suppose, I want to invest 50,000/- in long term tax saving FD in a nationalised bank. Can I avail 50,000 under sec.80c for the first year? and also 50,000 plus interest amount 4500 @9% in the next preceding year?
example : investment 50,000 + 4500 interest = 54500 first year.
54000+ again 4500 interst for second year..., and so on till 5th year?
thanks, KRishna
23 August 2011
No, only first year can be availed deduction u/s.80C and interest will be taxable under Income from other sources
further year in case you have new deposit other than Rs.50000 then you can claim not for old Rs.50000
further year in case you have new deposit other than Rs.50000 then you can claim not for old Rs.50000
23 August 2011
For the purpose for u/s 80C there is separate type of Term Deposit Deposit. You should not taken loan on this Term Deposit.Accrued interst is not eligible as reinvestment u/s 80c.Interest income is taxable according to accrued basis.
24 August 2011
I agree with the opinions given by both the experts.
As interest is taxable in Bank Tax Saving FDs, NSC is a better option in compare to FDs. There Interest is deemed to be reinvested and such deduction in respect of first 5 years interest can be claimed.
As interest is taxable in Bank Tax Saving FDs, NSC is a better option in compare to FDs. There Interest is deemed to be reinvested and such deduction in respect of first 5 years interest can be claimed.
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