Fixed Deposit Tax Saver, etc

Tax saver fixed deposits (FDs) are a type of fixed deposit that offers tax deductions under Section 80C of the Income Tax Act, 1961. This means you can claim a deduction of up to Rs 1.5 lakh per year on the amount invested in a tax-saving FD.

Key Features:

• Lock-in period: 5 years
• Tax benefits: Deduction under Section 80C
• Interest: Taxable
• Returns: Generally lower than regular FDs due to tax benefits

How it works:

• You invest a lump sum amount in a tax-saver FD for a period of 5 years.
• The amount invested is eligible for tax deduction under Section 80C.
• The interest earned on the FD is taxable.

Benefits:

• Tax savings: Reduces your taxable income.
• Safe investment: Considered a low-risk investment option.
• Guaranteed returns: The interest rate is fixed at the time of deposit.