Tax on interest from fd

When to declare Income from other sources?

Income chargeable under this head shall be computed as per the method of accounting followed by assesses.

There are two methods of accounting namely

• Cash basis :  the income is recognized only on its actual receipt and expenses are recognized only on its actual payment
• Mercantile basis: the income is recognized even before its actual receipt and expense is recognized even before its actual payment

There are 2 options to declare the interest:

• At the time of maturity of the Fixed Deposit or
• Every year, on the basis of accrual i.e., interest earned but not yet received

If TDS is deducted on Fixed Deposit then as it will appear in Form 26AS then you MUST to show it in the same year as tax calculation will be based on it.