Reccuring Deposit Taxablility

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student
212 Points Posted on 20 August 2021
Can we claim deduction on investment in RD or does it attract taxability on Maturity amount ?
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On 20 August 2021 at 20:31 Report
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This discussion clarifies the tax implications of Recurring Deposits (RDs). It confirms that the principal amount invested in an RD is not eligible for tax deduction. Only the interest earned on the RD is taxable as income from other sources. Tax should ideally be offered on an accrual basis, and Tax Deducted at Source (TDS) may apply if the annual interest exceeds a certain threshold.

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Chartered Accountant
24588 Points Posted on 21 August 2021
It is taxable on maturity amount.. if interest exceeds 40000 rupees then tds should be deducted
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On 21 August 2021 at 06:09
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student
212 Points Posted on 21 August 2021
Only interest amount ?
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On 21 August 2021 at 08:31
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Practising CA
8954 Points Posted on 21 August 2021
The taxability is only of Interest. You should offer the interest for tax on accrual basis rather than maturity basis. Investment in RD is not an eligible deduction for tax purposes.
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On 21 August 2021 at 09:48
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Chief Accountant
3150 Points Posted on 21 August 2021
You can not claim deduction on investment in RD, it's not eligible for deduction.
Only interest amount is taxable as income from other sources
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On 21 August 2021 at 14:24
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Chartered Accountant
24588 Points Posted on 22 August 2021
Agree with raj ji
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On 22 August 2021 at 06:15

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