Topic: Which fixed deposits are taxable under 80C?

I have come to know that certain Fixed deposits are eligible for tax deduction under section 80C, if this is correct please provide the details.

This message was edited 1 time. Last update was at 22/04/2009 16:14:59

From 2006 onwards bank fixed deposits are eligible for deduction under section 80C. Fixed deposits booked by an Individual/HUF for 5 years & upto Rs. 1,00,000/- are now allowed exemption under Sec 80C of the Income Tax Act,1961.

- Minimum Amount: Rs.100.
- Multiples of Rs.100.
- Maximum Amount: Rs. 1 lakhs.
- Tenure - 5 years (lock in period).
- Interest rate offered to senior Citizens is generally 05 % higher than that offered to others.
- Monthly or Quarterly interest pay-out option is available.
- No Partial/Premature withdrawal allowed.
- No OD or pledge allowed.
- In the case of joint holder deposit, the deduction from income under section 80C of the Act shall be available only to the first holder of the deposit

LalsinghYadav wrote:I have come to know that certain Fixed deposits are eligible for tax deduction under section 80C, if this is correct please provide the details.

INTEREST ACCRUED ON TERM DEPOSIT UNDER SECTION 80C IS TAXABLE AS INTEREST UNDER THE HEAD INCOME FROM OTHER SOURCES.

THE MATURITY AMOUNT INCLUDES PRINCIPLE AMOUNT INVESTED AND THE INTEREST ELEMENTS ONLY, BOTH OF THEM ARE EXEPT FROM TAX.

INTEREST ACCRUED ON ABOVE TERM DEPOSIT U/S 80C WILL NOT BE QUALIFIED AS REVINVESTMENT AND HENCE NOT ELIGIBLE FOR DEDUCTION UNDER SECTION 80C.

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