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sachin Alwadhi (cma)     18 June 2021

Premature Fixed deposit tax treatment

Hi

Kindly guide if we withdraw our Fixed deposit with bank before maturity period then what will be the treatment of Fixed deposit withdrawl before maturity period ?Whether taxable or exempted income while filing ITR .

 

 

Regards

Sachin Alwadhi

 



 2 Replies

CMA Poornima Madhava

CMA Poornima Madhava (CMA)     18 June 2021

FD as such is not taxable. For pre-closure of FD, banks usually charge penalty which will be a cut from the interest. Net interest income is taxable.

1 Like
veerendar singh

veerendar singh (tax consultant)     19 June 2021

Sachin you have to find out the interest income for the relevant year and offer only the interest income for taxation
the return of pricipal amount is not taxable on premature withdrawal
1 Like

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