Bank FDs: If you are also going to get your FD then this is important news for you. Today we will tell you some important things related to FD.
New Delhi: Bank FDs are a great investment option for all investors in today’s time. Talking about safe investment option in Corona period, the name of Bank FD (Fixed Deposit) comes first. If you are also going to get your FD then this is important news for you. Today we will tell you some important things related to FD. Let us tell you that the lowest interest rate in PSU Bank FD is 5 percent. Even after this, it remains the most preferred option of investors because it is a risk-free investment option.
Through bank FD, investors get the benefit of tax exemption along with interest. Because of this also it is considered a good investment option. According to Praveen Kutty, Head of Retail Banking, DCB Bank, Fixed Deposits come with free life insurance without any medical check-up, the cover is equal to the FD amount.
These are the advantages of investing in FD
- Fixed Deposit is considered to be the safest investment option.
- There is no risk on the principal deposited in this. Along with this, you can also get returns within a stipulated period.
- The principal amount invested in it remains safe as there is no direct effect of market fluctuations on FD.
- In this scheme, investors can take advantage of monthly interest.
- Generally the interest rate available on FD is high. For senior citizens, it gives the highest returns.
- One has to invest in any FD only once. If the investor wants to make more deposits after this, then he will have to open a separate FD account.
- FD has a maturity period, you have to deposit money for that many years. But this advantage is also that if needed, you can withdraw money even before time. However, if you break the FD before maturity, you lose interest, there is also some penalty on it. Which is different in different banks.
What is the tax deduction rule on FD
There is a tax deduction of 0 to 30 percent on fixed deposits. It is deducted based on the income tax slab of the investor. If you earn more than Rs 10,000 in a year, then you will have to pay 10 percent tax on your FD. However, for this you will have to submit a copy of your PAN card. If PAN card is not submitted, then 20 percent TDS is deducted on it.
If the investor wants to avoid tax deduction, then for this they should submit Form 15A to their bank. This is applicable for those people who do not fall in any income tax slab. Senior citizens should submit Form 15H to avoid tax deduction.
