State Bank of India (SBI) is an Indian Public Sector Bank and the largest bank in our country India holding 23% market share of assets and 25% share of cumulative loan and deposits. It is a multinational bank providing finance facilities to people worldwide, including countries like Australia, Canada, Nepal, Sri Lanka, Mauritius, United Kingdom.
SBI provides various facilities like a variety of SBI fixed deposits suitable to every individual, provides long term and short term loans, loan against collateral and different types of accounts.
What is Tax Saving Fixed Deposit?
The Tax Saving Fixed Deposit is a kind of fixed deposit where you can invest a sum of money and claim a tax deduction under section 80C of the Income Tax Act.
Banking and Non-Banking Financial Companies offer Tax Saving Fixed Deposits. Before selecting any tax saving schemes, depositors need to find out the different interest rates along with other terms and conditions of banks offering Tax Saving Fixed Deposits.
SBI Fixed Deposits –
Various fixed deposits offered by the SBI are mentioned below :
- Regular Fixed Deposit
- SBI Tax Saving Fixed Deposit
- SBI Multi Option Deposit Scheme
- SBI Wecare Deposit
- Money Multiplier Plan
- Flexi Deposit Scheme
- Reinvestment Plan
SBI fixed deposit interest rates vary from 2.90% to 5.40%. SBI fixed deposit is a good choice when an individual is looking for a safe fixed deposit. The interest rates on fixed deposits range from 3.40% to 6.20%. SBI offers customizable bank products and offers to individuals based on their needs and requirements.
SBI Tax Saving Fixed Deposit Scheme
State Bank of India (SBI) provides the Tax Saving Fixed Deposit Scheme 2006, from which you can receive tax benefits on your investments.
This fixed deposit scheme comes with a lock-in period of 5 years. The scheme gives a tax exemption of up to Rs. 1.5 lakh under Section 80C of the Income Tax Act. The senior citizens can avail of 0.50% further interest on fixed deposit.
Features of SBI Tax Saving Fixed Deposit Scheme
- A minimum deposit of INR 1000 and a maximum deposit of INR 1.5 lakh in a financial year.
- The tenor may range from a minimum of 5 years to a maximum of 10 years.
- Tax saving FD can be opened by Indian Residents and members of a Hindu Undivided Family (HUF).
- You cannot withdraw the deposit prior to the expiry of 5 years from the date of deposit except in case of death of the depositor.
- The interest on the sum of the deposit is paid at the time of the maturity only.
Documents Required to open SBI fixed deposit for tax saving
- SBI Application Form
- Depositor’s photograph (2)
- Identity proof & Address proof for KYC.
- PAN Card copy OR Form 60/61
- Aadhaar Card.
- Age Proof (for senior citizens)
Steps to open an SBI fixed deposit account for tax saving ONLINE
- Login to SBI net banking using username and password
- Visit the home page, browse through the top menu and click on the e-fixed deposit
- Now proceed to click on the e – TDR/e – STDR under the Income Tax Saving Scheme option and click on proceed.
- Select the account that you want the amount to be debited, enter in the fixed deposit sum and in the case of senior citizen, click on the Senior Citizen
- Then choose whether you want a cumulative (STDR) or a non-cumulative (TDR) FD, choose the term, maturity details, accept all the terms and conditions, and click on the Submit button.
Cumulative FD – no fixed interest payable over a quarter, half-year or annually. The interest is compounded every quarter or year and payable at the time of maturity along with the principal.
Non-Cumulative FD – interest is paid on a quarterly, monthly or annual basis. The interest earned monthly from non-cumulative fixed deposits is taxable. This scheme is highly suitable for people who need an interest payout periodically.
SBI fixed deposit interest rate on Tax Saving Fixed Deposit Scheme
Regular Citizens – 5.40 %
Senior Citizens (age 60 and above) – 6.20 %
This scheme is highly beneficial, but many are not aware of Tax Saving Fixed Deposit. Through this article, you would be able to know the benefits of the Tax Saving Fixed Deposit Scheme for both regular and senior citizens. The SBI Tax Saving Fixed Deposit is available at all the branches of the bank, and also it can be transferred among various SBI branches.