Invest in Tax saving FD schemes offering high interest

Tax Saving FD Interest ratesInvest in Tax saving fixed deposits (FD) schemes offering high interest

If you are planning to save tax by December, start saving money from this month itself. Tax Saving FD schemes offer attractive interest rates now which may continue for another couple of months. I have done a comprehensive list of Tax Saving Fixed deposit interest rates and you can choose the best one among the list. This post is based on request made by Prathap on "Suggest a topic".

Tax Saving FD schemes

If you want to save tax on your salary, you can invest up to Rs 100,000 u/s 80C and get income tax exemption. Out of the all available tax saving schemes, Tax Saving FD schemes are favorite one for many of us.

Also read: How Salary individuals can save income tax u/s 80C and beyond?

High Interest: Out of all tax saving options available to you u/s 80C, Bank FD schemes offer fixed interest.

Principal is protected: If you consider ELSS tax saving scheme, there is risk of capital erosion, however investing in Bank tax saving FD, there is no such risk.

Tenure: Out of available secured tax saving options u/s 80C, tax saving bank FD’s are the only options available which are 5 years period paying high interest. Though PPF also offers high interest, the maturity of the PPF is 15 years. NSC tenure might be comparable, but interest rates are low.

Tax Saving FD interest rates as of 3-Oct-13

Tax saving Fixed Deposit (FD) rates

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Invest in Tax saving fixed deposits (FD) schemes offering high interest


  • ame

    I have some doubts if possible please try to explain…

    1. If i invest 100000 in SBI as FD for five years and i showed this as tax excemption. Is it possible for me to withdraw the FD after 1 or 2 months.

    2. is it possible to invest more than 200000 as FD for tax excemption.

    3. is it allowed for tax excemption if i invest more than one FD in one account.


    • Hi Ame, 1) You cannot withdraw tax saving FD before 5 years 2) Even if you invest Rs 2 Lakhs, you would get only Rs 1.5 laksh as tax exemption u/s 80C. 3) Yes, you can invest in multiple tax saving FD schemes, however maximum exemption comes to RS 1.5 Lakhs u/s 80c.

  • Mridula

    I have a small doubt. My book states the following

    If any amount including interest accrued is withdrawn by the assessee from his account before the expiry of 5 yrs ,the amount shall be deemed to be the income of the assessee in the year of withdrawal. However the following amounts shall not be included :
    Interest already included in the total income of the assessee of the previous or years preceding such previous year.

    Can you please explain what the last two lines mean?

  • Baldev singh

    Please clarify my doubt whether intt. Earned on bank fd tax saving scheme is taxable or not.thanks.


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