Tax savings is one of the most important things for a person to do since we pay taxes on up to 40% of our hard-earned income.
Different banks offer different types of tax-saving fixed deposits with high-interest rates and a lot of tax savings. Public Provident Fund and National Savings Certificate are no longer the only ways to save money on taxes. Section 80C also lets you deduct bank Fixed Deposits that help you save on taxes. There is a 5-year lock-in period for the deposits. At the moment, the returns on tax-saving Fixed Deposits range from 7.50 to 8.50% per year. The minimum investment amount (per year) has been set at Rs 100, and the maximum investment amount has been set at Rs 100,000. With the introduction of tax-saving Fixed Deposits, investors who don't like taking risks can diversify their investments and plan their taxes at the same time. You can put your money into a fixed deposit account for a certain amount of time and get a higher rate of interest in return. The interest rate on a fixed deposit is also higher than the rate on a savings account. From August 4, IDBI will offer a five-year IDBI Suvidha Tax Saving Fixed Deposit. The interest rate for a five-year deposit is 8.5%. The interest rate would be higher for people over the age of 65, at 9%. An Undivided Family can invest up to Rs. 1 lakh under the scheme. Before taxes, the return on the deposit comes to more than 12%.
