Despite the fluctuating rate of interest, a fixed deposit scheme remains a very lucrative option for customers who want guaranteed returns on their investments. A fixed deposit investment comes with different maturity periods, ranging from 7 days to 10 years. Opening a fixed deposit account is not really a difficult thing. However, you must be aware of certain rules that come with this service.
• Joint fixed deposit
If you have a joint fixed deposit account, then the Tax Deducted at Source or TDS will be deducted from the first account holder’s PAN. In addition, the interests are also paid to the first depositor and the tax liability is measured on the first applicant’s name only.
• Interest income clubbing
The interests earned on your fixed deposit account are clubbed across all the branches of the respective bank. This is done for determining the applicability of the TDS and for evaluating the total interest accumulated during a financial year.
• Overdraft/ loan facility
Many banks offer overdrafts/ loan facility up to 90% of the principal deposit. In such cases, the banks charge 1% hiked interest rate compared to the interest rate earned on the respective fixed deposit account.
• Deposit insurance
Deposit insurance is defined as a protective cover that you generally get on your bank deposits. It is offered by a subsidiary of the Reserve Bank of India (RBI) known as Deposit Insurance and Credit Guarantee Corporation (DICGC). This premium is paid by the bank itself and in case it fails to do so, it has to pay a maximum amount of Rs.1 lakh to each depositor for both interest and principal amount.
• TDS factor
The interest imposed on your fixed deposit scheme is taxable. This signifies that your interest income will be added to your income and taxes will be imposed on it, based on additional tax slabs. Generally, banks deduct 10% on the interest earned in case the annual interest income is Rs.10,000. If any of your refunds are due, then you will have to file an income tax return to claim it.
• Accounts for minors
If you want to open an independent account, then you will have to be 10 years or above and should have the ability to read and write. If not, then you will have to open a joint account with your legal guardian. The maximum amount that you can deposit in your account should not be more than Rs.1,00,000. There are no limitations when it comes to minors aged above 14 years.
Fixed deposit investment can go a long way in helping you save money not just for the present but the future too. Since you are investing your hard-earned money in this account, it is always ensured that you get sufficient and lucrative returns for that. Therefore, do not shy away from opening a fixed deposit account today. In case you have any doubts or questions, you can call on your bank’s helpline number and consult them.
• Joint fixed deposit
If you have a joint fixed deposit account, then the Tax Deducted at Source or TDS will be deducted from the first account holder’s PAN. In addition, the interests are also paid to the first depositor and the tax liability is measured on the first applicant’s name only.
• Interest income clubbing
The interests earned on your fixed deposit account are clubbed across all the branches of the respective bank. This is done for determining the applicability of the TDS and for evaluating the total interest accumulated during a financial year.
• Overdraft/ loan facility
Many banks offer overdrafts/ loan facility up to 90% of the principal deposit. In such cases, the banks charge 1% hiked interest rate compared to the interest rate earned on the respective fixed deposit account.
• Deposit insurance
Deposit insurance is defined as a protective cover that you generally get on your bank deposits. It is offered by a subsidiary of the Reserve Bank of India (RBI) known as Deposit Insurance and Credit Guarantee Corporation (DICGC). This premium is paid by the bank itself and in case it fails to do so, it has to pay a maximum amount of Rs.1 lakh to each depositor for both interest and principal amount.
• TDS factor
The interest imposed on your fixed deposit scheme is taxable. This signifies that your interest income will be added to your income and taxes will be imposed on it, based on additional tax slabs. Generally, banks deduct 10% on the interest earned in case the annual interest income is Rs.10,000. If any of your refunds are due, then you will have to file an income tax return to claim it.
• Accounts for minors
If you want to open an independent account, then you will have to be 10 years or above and should have the ability to read and write. If not, then you will have to open a joint account with your legal guardian. The maximum amount that you can deposit in your account should not be more than Rs.1,00,000. There are no limitations when it comes to minors aged above 14 years.
Fixed deposit investment can go a long way in helping you save money not just for the present but the future too. Since you are investing your hard-earned money in this account, it is always ensured that you get sufficient and lucrative returns for that. Therefore, do not shy away from opening a fixed deposit account today. In case you have any doubts or questions, you can call on your bank’s helpline number and consult them.
No comments:
Post a Comment