How Much Fixed Deposit (FD) Interest is Tax-Free in India?

Discover how much interest from Fixed Deposits is tax-free. Learn the limits under Sections 80TTA and 80TTB for individuals and senior citizens.

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Interest earned on Fixed Deposits (FDs) is taxable. However, up to ₹10,000 per year from all FDs is tax-free under Section 80TTA for individuals below 60 years. For senior citizens, the limit is increased to ₹50,000 per year under Section 80TTB. Ensure you include FD interest income in your tax returns and use these sections for tax benefits.

FAQs & Answers

  1. What is the tax-free limit for FD interest for individuals below 60? Individuals below 60 can earn up to ₹10,000 per year from Fixed Deposit (FD) interest tax-free under Section 80TTA.
  2. What is the tax-free limit for FD interest for senior citizens? Senior citizens can earn up to ₹50,000 per year from Fixed Deposit (FD) interest tax-free under Section 80TTB.
  3. Do I need to include FD interest in my tax returns? Yes, it is important to include FD interest income in your tax returns to comply with tax regulations.
  4. How does Section 80TTA help with FD interest taxation? Section 80TTA allows individuals below 60 to claim a deduction of up to ₹10,000 from their total income for interest earned on FDs, thereby reducing taxable income.

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