Incorporated on March 5, 1907, with an authorised capital of ₹20 lakhs, Indian Bank commenced its business on August 15 of the same year. Among other financial services the bank provides, fixed deposits are quite popular among customers because of safety, security and attractive interest rates.
Indian Bank Tax Saver FD scheme allows you to invest while saving tax under Section 80C of the Income Tax Act. Under this tax-saving scheme, the minimum tenure for a fixed deposit is 5 years, while a maximum tenure extends to 10 years. In a given financial year, you can invest up to a maximum of ₹1.5 lakhs in this scheme. For more information regarding this FD scheme, keep reading the comprehensive blog.
Interest Rates on Indian Bank Tax Saving FD 2024
Indian Bank offers attractive interest rates on tax-saving FDs. Take a look at the following to find out the applicable Indian Bank tax saver FD interest rate.
| Tenure | General Public | Senior Citizens | |
| IB Tax Saver Scheme | For 5 years | 6.25% | 6.75% |
| For above 5 years to 10 years | 6.10% | 6.60% |
Features of Indian Bank Tax Saving FD
If you are one among the depositors who want to take advantage of tax benefits provided under Section 80C of the Income Tax Act, then the Indian Bank Tax Saver FD scheme is suitable for you. The key features of this scheme are as follows.
| Account type | Term Deposit (TD) or Special Term Deposit (STD) |
| Minimum Amount | ₹1,000 |
| Maximum Amount | ₹1.5 lakhs |
| Minimum Tenure | 5 years |
| Maximum Tenure | 10 years |
| Premature withdrawal | Not available before 5 years |
| Loan facility | Not available before 5 years |
| Nomination facility | Available |
Indian Bank Tax Saving FD Interest Calculator
The formula used by the Indian Bank to determine profitability and manually calculate any FD maturity amount is as follows.
A = P (1+r/n) ^ n x t
In this equation;
- ‘t’ is the investment tenure.
- ‘n’ is the interest payout frequency.
- ‘r’ is the interest rate.
- ‘P’ is the initial investment.
- ‘A’ is the total amount accumulated on maturity.
How to Open an Indian Bank Tax Saving FD Online?
To open a tax saving FD with Indian Bank, part of the process which you can do online is up till the downloading of the required form. The steps are as follows.
- Step 1: Open the official website of the Indian Bank.
- Step 2: At the right-most corner of the screen, click on the ‘Forms Download’ button.
- Step 3: In the ‘Forms Download’ page, click on ‘Common Account Opening Form – Individuals’ in the ‘General Application Forms’ section.
- Step 4: Download the form and take a printout.
- Step 5: While filling out the form, tick the box for ‘Fixed Deposit/MOD/RD’ in section 1 (‘Type of Account’).
- Step 6: In section 4, tick the box for ‘TAX SAVING SCHEME’.
- Step 7: Fill out the rest of the fields carefully, and submit the form to any Indian Bank branch, along with KYC (Know Your Customer) documents.
- Step 8: The bank will issue an FD receipt and send it to you.
Indian Bank Tax Saving FD Scheme Eligibility
The following types of people are eligible for opening Indian Bank Tax Saver FD schemes.
- Resident Indian individuals above 18 years of age.
- HUFs (Hindu Undivided Families).
- A minor, jointly with an adult from the above-mentioned group.
Documents Required to Open an Indian Bank Tax Saving FD Scheme
You need to submit a few government-recognized IDs and address proof documents to open an Indian Bank Tax Saving FD scheme. The following is a list of documents you need to submit.
- Voter ID Card
- Driving Licence
- Aadhaar Card
- Ration Card
- Passport
- Proof of Age (for senior citizens)
- 2 coloured passport-size photographs (recent)
- PAN (Permanent Account Number) Card
Benefits of the Indian Bank Tax Saving FD Scheme
A simple yet effective way to save taxes is by opening fixed deposits with banks. Some of these schemes offer tax deductions under Section 80C and come with high-yielding interest rates and flexible tenures. Customers/individuals looking for a safe and guaranteed return on their investments find these schemes very reliable and useful. The Indian Bank Tax Saver FD has the following benefits.
- Interest earned on tax-saving FDs is taxable as per your income tax slab.
- Tax-saving FD investments are eligible for deductions under Section 80C, up to a maximum limit of ₹1,50,000 in a financial year.
- The lock-in period for Indian Bank tax saving FD is 5 years, which means your money remains invested for this duration and grows steadily without any effort from your end.
- Like other FD schemes, it is a safe and low-risk investment instrument.
- It has higher interest-earning potential than savings accounts.
Terms and Conditions of Indian Bank Tax Saving Scheme
Terms and conditions specific to Indian Bank tax saving FD are as follows.
- No withdrawal or foreclosure is allowed before the minimum tenure of 5 years.
- Tax-saving FD investments (up to a maximum limit of ₹1,50,000) are eligible for deductions under Section 80C, in a financial year.
- The maximum tenure for which you can continue an Indian Bank tax saving FD is 10 years.
- The detailed ‘Terms and Conditions’ covering all kinds of fixed deposit schemes (including tax-saving FD) offered by Indian Bank is available on the official website.
Final Word
The unique lock-in period and the provision of tax benefits are what separates a tax-saving FD from a regular FD. Although the interest accrued on the amount deposited in a tax-saving FD is taxable, you can claim a tax deduction of up to ₹1,50,000. If tax saving is a part of your larger financial goal, then Indian Bank Tax Saver FD can be a suitable investment instrument for you.
FAQ
Many customers wish to grow their investments along with enjoying tax benefits in a financial year. Indian Bank Tax Saver FD scheme satisfies the requirements of those customers.
No, you are not allowed to make a premature withdrawal from your Indian Bank Tax Saver FD account. The money needs to be kept with the bank for a fixed term of 5 years to get the income tax benefits.
Under the Indian Bank Tax Saver FD scheme, interests get compounded quarterly.
Disclaimer
This article is solely for educational purposes. Stable Money doesn't take any responsibility for the information or claims made in the blog.
