If the right investment avenues are chosen in advance, we get the right returns on time and we are also able to save tax. Government bank State Bank of India has a similar scheme – SBI Tax Saving Scheme, 2006.
When we start investing, our initial thought is that the investment should be such that it is safe, gives good returns and not to mention tax exemption on it. When it comes to tax saving before filing income tax return, then it seems that from where to save tax, in such a situation, if the right investment avenues are chosen in advance, then the right return is also available on time and we can save tax. Can also save. One such scheme is of the government bank State Bank of India – SBI Tax Saving Scheme, 2006. Let us know about it and how it benefits you.
What is SBI Tax Saving Scheme, 2006?
SBI gives customers the option to invest in term deposits or special term deposits under this scheme. On this, interest is received as per the interest rate given by the bank on term deposits. Under this scheme, you can invest in your term deposits for minimum five years and maximum 10 years. Currently, SBI general category customers get interest at the rate of 6.50% on deposits of five to 10 years. Senior citizens get returns at the rate of 7.50%.
Benefit of compound interest
In this scheme you get the benefit of compound interest, that is, you get interest on interest. Compound interest is calculated on your total amount every quarter.
Calculation
For example, you invest Rs 6 lakh in this scheme for 5 years and you get a return at the rate of 6.6%, then the maturity value of your investment will be Rs 8,32,336, the interest value i.e. the total income from interest will be Rs 2,32,336. Will happen.
How to get tax exemption?
However, you will have to invest in term deposits for a minimum period of five years and maximum 10 years to get tax exemption. There is a provision for exemption on this in Section 80C of the Income Tax Act and you can avail tax exemption of up to Rs 1.5 lakh in a year. To get tax exemption in this scheme, you will have to keep the deposit for at least five years, it comes with a lock-in period of 5 years for tax saving.
