Accrued interest

Amit Kumar Das (Others) (138 Points)

19 September 2014  

I have FDs in banks in cumulative mode in which I shall get the maturity after a few years.
In the mean time interest accrues but not paid.
What is the correct provisions of Income Tax Act?
Am I required to include annually accrued interest in each year's income till maturity and pay tax on it?
Or, I can defer such payment till maturity year and then pay tax on the total accumulated interest?
Or, I can go either way?