Difference in TD maturity value and Actual value

144 views 1 replies
User Avatar

26 Points Joined June 2017
I am having a TD of 5yrs wherein the interest will get on maturity. Now the TD is matured but there is a difference in maturity value and actual value which was credited in my account. Upon asking the bank, they said that the TDS amount deducted will not be considered for future interest calculation till maturity of the TD and because of which there is a difference in maturity and actual amount. Please help me in this matter
0 Reply Share Follow
On 19 August 2024 at 18:19 Report
Replies (1)
User Avatar

Master in Accounts & high court Advocate
9447 Points Joined December 2011

In India, banks deduct TDS (Tax Deducted at Source) on interest earned from term deposits, such as Fixed Deposits (FDs). The loss of amount to be borne by the term depositor is due to the TDS deduction, which is a government mandate. Here's why: 1. *Tax liability*: The interest earned on term deposits is taxable as per Indian income tax laws. 2. *TDS deduction*: Banks deduct TDS on behalf of the government to ensure tax compliance. 3. *Tax credit*: The depositor can claim tax credit for the TDS amount deducted while filing their income tax return. To minimize the loss, depositors can: 1. *Submit Form 15G/15H*: If their total income is below the taxable limit, they can submit Form 15G/15H to avoid TDS deduction. 2. *Opt for cumulative interest*: Some banks offer cumulative interest, where interest is compounded and paid at maturity, reducing TDS liability. 3. *Consider tax-free alternatives*: Look into tax-free investment options, like tax-free bonds or PPF (Public Provident Fund). Remember to consult a tax professional or financial advisor for personalized advice!

Reply
On 20 August 2024 at 09:57


CCI Pro

Leave a Reply

Post Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Recent Threads

More recent discussions | Post

Related Threads
Loading