Select Your Location
A person can create a fixed deposit account from a period as low as 1 year to as high as 10 years but do you know that 5 year fixed deposit is unique and it offers tax-saving benefits. Your money may get locked up for 5 years, but it can be a profitable investment for taxpayers considering the tax-saving benefits. In this article, we shall discuss about tax saver fixed deposit in detail.
A fixed deposit account is an investment instrument which is provided by banks wherein investors can deposit a lump sum amount for a specified period. The investors will get a fixed rate of interest, and it may be noted that the interest rate provided on fixed deposits are higher than that of a regular savings bank account.
After the specified period is over, investors can withdraw their investment. All scheduled commercial banks and some NBFCs offer the provision of fixed deposit accounts. Before investing in FDs offered by NBFCs or HFC, check ratings of such financial institution to ensure that the money you deposit remains safe.
This will work in the manner in which other general fixed deposit account work where a lump-sum amount is invested for a fixed tenure. It is the safest investment option as the money is safely invested, and interest can be earned at a pre-determined rate.
The rate of interest would be low or high, just like any other non-tax saving FDs. Making investment in Fixed deposit will not adversely affect even if the market becomes unfavourable. But, you will not be able to withdraw your money at any time before maturity.
The following are some of the essential features of Tax saver FD:
A 5 year Tax saving FD can be a suitable option for you if you:
If you have low/moderate risk appetite, then you should consider investing in this FD, and if you desire to earn guaranteed returns, then also you can invest in this.
When you invest in a 5 year tax saving FD, you cannot liquidate investments in between therefore, you should have funds at your disposal before you decide for 5 years tax saver fixed deposit investment. It will assist you in case of any emergency during the 5 year period.
If you desire to invest in something with low risk and with assured returns and want to enjoy tax benefits, then 5 year tax saver FD can be the way forward for you.
One can open a 5 year tax saving fixed deposit account from the comfort of their home as the process is online. You can also compare interest rates offered by different banks on these deposits and also compare features of FD.
If you have an account with the bank, then you may create fixed deposit account through internet banking. If you want to open tax saving FD in a bank where you don’t have an account, then you are required to submit KYC documents such as ID proof, address proof to open an account. These documents should be submitted with an application form duly signed.
Assess yourself before making investments, if the investment you make is suitable for you or not. 5 year tax saver fixed deposit is distinct, and it offers tax-saving benefits. It can be beneficial for those with low or moderate risks.
Read our article:Tax saving Scheme under section 80C
Ashish M. Shaji has done his graduation in law (BA. LLB) from CCS University. He has keen interests in doing extensive research and writing on legal subjects especially on corporate law. He is a creative thinker and has a great interest in exploring legal subjects.
On 18th May 2023, the Securities Exchange Board of India (SEBI) released a Consultation Paper o...
Infrastructure and real estate have been regarded as India's "sunshine sector" since the turn o...
On 22nd May 2023, the Central Board of Direct Taxes (CBDT) issued a new circular under secti...
Anyone can have different sources of income. With globalization and the opening up of economies...
The Reserve Bank of India (RBI) is crucial in regulating NBFC, including branch openings and cl...
In India, Non-Banking Financial Companies are subject to certain restrictions from taking publi...
It's usually a good idea to diversify the assets in your financial portfolio, especially during...
A nation is being built by the non-banking finance company through the development of wealth, t...
A corporate entity known as a portfolio manager complies with a contract or agreement with the...
Identifying and analysing risks associated with individual portfolio investments, such as equit...
Are you human?: 6 + 4 =
Easy Payment Options Available No Spam. No Sharing. 100% Confidentiality
In the "Financial Stability and Development Council" meeting held on 20th June 2019, the highlights of the upcoming...
22 Jun, 2019
The Income Tax Department has announced the release of the Annual Information Statement (AIS), which will give you...
13 Dec, 2021
Red Herring Top 100 Asia enlists outstanding entrepreneurs and promising companies. It selects the award winners from approximately 2000 privately financed companies each year in the Asia. Since 1996, Red Herring has kept tabs on these up-and-comers. Red Herring editors were among the first to recognize that companies such as Google, Facebook, Kakao, Alibaba, Twitter, Rakuten, Salesforce.com, Xiaomi and YouTube would change the way we live and work.
Researchers have found out that organization using new technologies in their accounting and tax have better productivity as compared to those using the traditional methods. Complying with the recent technological trends in the accounting industry, Enterslice was formed to focus on the emerging start up companies and bring innovation in their traditional Chartered Accountants & Legal profession services, disrupt traditional Chartered Accountants practice mechanism & Lawyers.
Stay updated with all the latest legal updates. Just enter your email address and subscribe for free!
Chat on Whatsapp
Hey I'm Suman. Let's Talk!