Several banks are currently providing a great opportunity for those looking to save on taxes by investing in fixed deposits. Along with the tax savings, these banks are offering up to a maximum of 7% interest rate on Tax Saver Fixed Deposits.
This is an excellent chance for both employees and self-employed individuals who are subject to income tax to reduce their tax burden. If you plan to save on taxes, you must invest in any of the eligible options before March 31, 2024.
These investments will make you eligible for an IT refund in the financial year 2023-24. Please note that many company owners require proof of tax-saving investments, so choose your investment options wisely based on your risk profile and financial goals.
You can select from various options such as the Public Provident Fund, National Pensions Scheme, Sukanya Samriddhi Yojana, Mutual Funds, Equity-Linked Savings Scheme, EPF, Life Insurance, and more. However, if you are risk-averse, the best option is to invest in bank fixed deposits, as many banks offer tax-saving fixed deposits.
Here is some information about tax-saving fixed deposits in the top 10 banks. These banks offer attractive interest rates for deposits up to Rs. 1 crore, with interest calculated and credited quarterly.
Among the private sector banks, Axis Bank, HDFC Bank, and ICICI Bank are currently offering the highest interest rate of 7% on tax-saving deposits. Investing Rs. 1.5 lakh in any of these banks can yield a maturity amount of Rs. 2.12 lakh after 5 years.
Canara Bank, a public sector bank, is currently offering a maximum interest rate of 6.7% on tax-saving deposits. If you invest Rs.1.5 lakh in this scheme, you will receive Rs.2.09 lakh after a period of 5 years.
On the other hand, State Bank of India, Bank of Baroda, the Punjab National Bank, and the Union Bank of India are offering a lower rate of 6.5% on tax-saving deposits. If you choose to invest the same amount of Rs.1.5 lakhs in these banks, the total amount you will receive after maturity is Rs.2.07 lakhs.
Indian Bank is offering an even lower rate of 6.25%, which means that Rs.1.5 lakhs invested in this scheme will come to Rs.2.05 lakhs after maturity. Lastly, Bank of India is offering a 6% interest rate on tax-saving deposits.
It’s important to note that all these deposits are insured by the Deposit Insurance Credit Guarantee Corporation (DICGC), and the Reserve Bank of India (RBI) provides security up to Rs.5 lakh. Therefore, there is no risk involved.
It is recommended that everyone should inquire about the Tax Saver FD interest rates with special scheme offers provided by the bank. You can either visit the nearby branch channel or check out the official website of the bank to get complete information about the Tax Saver FD offered by the bank.