About Fixed Deposit... and tax process on it

First of all you have to pay tax on the source of this Rs. 90 Lacs and maximum Deductions you could have by invesing in FD is just 1.5 Lakhs.

Even If you want make 5 different FDs in name of every family still the source would be Taxable in your hands only.

As long as your question of monthly income from FD Interest; the answer is YES. Yes, you can withdraw the interest of Fixed Deposit on monthly basis. When you invest your money in FD, you get interest on your principal amount. This interest can be obtained after maturity of fixed deposit or even before that on monthly, quarterly, half-yearly or annual basis.

If you invest in Non-Cumulative FD along with the principal amount and investment tenor, you will be able to choose interest payment frequency. But, on the basis of interest payment frequency, your rate of interest will also change. Like, if you withdraw the interest on annually, you can get interest 7.85%, in half-yearly it is 7.70%, in quarterly it is 7.63% and in monthly it is 7.58%. So, more frequently you withdraw the interest, the less interest you will get.


For maximum tax benefits you have to invest in multiple investment under different sections and not to be concentrated with only One section.

It is possible to divert the income in this case.

If a gift is given to the family members (who satisfies the definition of relatives as per explanation to S.56(2)(vii), except to the spouse and minor child, then the income from such FD shall be chargeable in their respective hands.