Top 5 bank deposits with favorable interest rates: which banks offer high interest rates and how much will your money grow? Control List

Top 5 Tax Saving FD Banks: While choosing a bank for a tax saving FD, it is essential to compare the interest rates offered by different… Read More

Top 5 Tax-Saving Bank Fixed Deposits: Tax-saving fixed deposits (FDs) offer a deduction of up to Rs 1.5 lakh under Section 80C of the Income Tax Act, 1961. The maximum permissible investment in a tax-saving FD per year is Rs 1.5 lakh, and the deposit has a mandatory lock-in period of five years.

Since tax-saving fixed deposits come with a validity period of five years, no premature withdrawal is permitted in the case of tax-saving fixed deposits. Simply put: your money will be blocked for five years.

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It is important to note that interest earned on tax-saving FDs attracts tax deduction at source (TDS) based on the investor’s tax slab. TDS applies to individuals if the total interest earned exceeds Rs 40,000 in a financial year, according to ET. However, senior citizens can claim an annual interest deduction of up to Rs 50,000 under Section 80TTB.

Top 5 Bank Term Deposits to Save on Taxes
While choosing a bank for a tax-efficient FD, it is essential to compare the interest rates offered by different banks rather than simply opting for the bank where you have a savings account. A higher interest rate translates into better returns in the long run.

We look at the top 5 tax-saving bank deposits, according to data compiled by ET Intelligence Group:

POSITION DURATION: 5 YEARS OR MORE	Interest rate (%)	What can 10,000 rupees be used for?
DCB Bank	7.4	14,428
Dhanlaxmi Bank	7.25	14,323
IndusInd Bank	7.25	14,323
YES Bank	7:25 a.m.	14,323
City Union Bank	7.1	14,217

Experts believe that interest rates on fixed deposits are likely to have peaked in the current cycle. As soon as the Reserve Bank of India (RBI) reduces the repo rate, banks will start cutting interest rates on fixed deposits.

“Given the current high level of interest rates and the fact that we have reached a plateau in terms of rate hikes, the current period offers the opportunity to secure higher returns before the reversal cycle ends. ‘switch on,’ advises Nirav Karkera, head of research at Fisdom.

Term Deposit Calculator: How much will Rs 10,000 invested in term deposits be?

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