Is interest from bank deposits taxable?

1, yes fixed deposit interest & recurring interest is taxable

     fixed deposit interest is morethan 10,000/- bank will deduct tds on it @ 10% if pan given otherwise @             20%

2. yes, as above exemption of non deduction is 10,000/- but it is a taxable component add to gross                    income

3. if your wife income for f.y. 2012-13 is not morethan 2 lacs then you can avail benefit of 15G which you           need to submit to bank for not do deduction

4. no there is not legal way to avoid its not good thing for tax saving you have to become smart as your case you have did fd of Rs.1 lacs and suppose interest around 10K  15G is the best opition till 2 lacs of income

my advice is not to do any fd on your name/PAN. because you are already in 20% so if you do fd then bank will deduct 10% and remaining you will have shown in your income and need to pay 10% additional tax so total 20% tax liability

so better to invest in your wife name/PAN

it will help you to understand the savings by ideally not by avoiding or legally

Your wife's interest income has to be clubbed to your income u/s 64(1). It shall not be taxable in the hands of your wife. It is taxable in your hands.

Thank you all for your quick response

Can I avoid tax on FD by opening FD in my mother'sname who has no income of her own?

Regards,

Praveen

Yes, you can avoid tax.

If the FD is in your mother's name, then the income from that shall not be hit by the clubbing provisions.

vinodaca74 @ gmail.com

Fixed deposit interest & recurring interest is taxable under other source of income.

1-> If interest on FD is morethan 10,000/- bank will deduct tds on it @ 10% provided you have given PAN no.

Else bank will deduct TDS @ 20% also this can't be refunded.

2-> There is no provision of TDS on interest upto rs. 10000/

3. if your wife income for f.y. 2012-13 is not morethan 2 lacs then you can claim refund of TDS deducted by filing her return electronically and thereafter caliming refund. TDS deducted acn be seen in FORM 26AS available on tin.nsdl.com

4. This is matter of tax planning, In our opinion you should make HUF, in you and your wife name, then your son & wife,s name.

So the benefit is that you will get fresh 190000/ tax free limit on each HUF you made. 

You may reach us at www.cajunction.in. For nay additional query.

$(document).ready(function() { $('#msgthnk966213').load('get_thanks.asp?msg_id=966213'); });

yes interest from fixed deposit taxable income....  under the head  income from other sources

Well,

As per my opinion, you should properly plan for your taxes and income division as well..

If You are having any child then go for HUF incorporation.

It is easy, simple and smart way to plan for taxes..

If any need, feel free to ask..

Regards,

CA Darshak Shah

Thank you all. Your responses and opinions are very helpful

I have a SMART MONEY deposit (Rs. 25000/-) with HSBC for 3 years @ 9% p.a. Contract is there , If I withdraw any amount interest will be charged @ 2% over & above 9%.  My question is this, whether the accrued interest @ 9% on Rs. 25000/- is taxable or the excess amount out of my overdraft interest will be taxable ?

Goutam Biswas

oldman240354 @ gmail.com

There is nobody to answer against my reply ? ..?

For an individual,the accrued interest @ 9% on Rs.25,000/- would be taxable.You cannot off-set the interest paid on overdraft amount against interest accrued/received on the original deposit.

Many Many Thanks to Balaji

ANY COMMENTS FROM ANOTHER PERSON EXPECTED.