Both commoners and senior citizens now have access to a variety of investment options. Due to rate increases, the post office’s schemes have shifted away from fixed deposits for some time.
Small savings plans have recently gained popularity thanks to the central government. Additionally included in these programs are tax savings programs. Senior grown-ups, then again, are bringing in higher cash because of the ascent in fixed store loan costs.
If you intend to invest in tax-saving schemes, let’s talk about some post office programs that offer higher interest rates than tax-saving fixed deposits. These plans include options like the National Savings System and time deposits.
How much do these post office programs pay in interest?
The National Savings Certificate Program’s interest rate was increased by 70 basis points during the April to June quarter by the federal government. From 7% in the previous quarter to 7.7% at the same time, interest in NSC increased. Additionally, the rate of time deposits has increased, reaching 7.5% at the same time. The remaining small savings plans’ interest rates have also increased.
What is the interest rate on FDs offered by which bank?
Major national banks are offering the majority of interest on tax-saving FDs. HDFC Bank offers interest rates of 7%, Axis Bank offers 7%, Bank of Baroda offers 6.5%, Central Bank offers 6.7%, ICICI Bank offers 7%, IndusInd Bank offers 7.25 percent, DCB Bank offers 7.6%, Yes Bank offers 7%, and IDFC Bank offers 7%. The duration of each of these interests is identical.
How much will the tax bill be reduced?
Assuming that you pick the past duty framework and store cash in a NSC, you can save charge under area 80C by up to Rs. 1.5 million annually. On the other hand, tax-free FDs let you save up to Rs 1.5 lakh per year.
Investment cap:
Tax-saving FD versus NSC You can invest as little as Rs 1,000 in Nationals Savings Certificates. However, there is no upper limit.
In the meantime, you can only invest Rs 1.5 lakh in tax-saving fixed deposits.
TDS: FD vs. NSC:
Saving on taxes The interest on a National Savings Certificate is not subject to tax withholding at source (TDS). However, a 10% TDS would be applied when the total interest income from all parked deposits with them exceeds Rs 40,000 in a given year. The TDS deduction on the interest income from bank fixed deposits, which saves taxes, will also reduce your return.
NSC loans can be used as collateral for individual loans. The tax-saving FD of a bank, on the other hand, cannot be used to obtain loans.
