How much TDS is applicable on Fixed Deposit and Recurring deposit interest?

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• Is there a TDS on Fixed Deposit/Recurring Deposit income?

  Yes, if the amount of interest accrued or paid during the financial year exceeds Rs.10,000/-, TDS is applicable from the first interest flow.

• Is there a deduction available on interest income from Fixed Deposits/Recurring Deposits?

  There is no deduction available on interest on FDs/RDs. The entire interest income earned from these is liable to be taxed on accrual basis at the slab rate applicable.

• Which section of the I-T Act deals with TDS on interest income?

  Section 194A deals with a deduction of TDS on interest other than ‘interest on securities’. This could include Fixed Deposits & Loans and Advances other than banks. This TDS is deducted for resident individuals only.

• How do I know what rate of TDS is applicable to my income?

  There are different TDS rates described in different sections of the Income Tax Act, depending on the type and manner of the payment. TDS is deducted by estimating the likely tax amount on your income as per the slab rates currently prevailing for ...

• Does filing Form 15G/Form15H mean that my interest income is not taxable?

  Form15G/Form15H is only a declaration that no TDS should be deducted on your interest income since tax on your total income is nil. Interest income from fixed deposits, recurring deposits, and corporate bonds is always taxable.