ICICI Tax Saving FD

Putting your money in a fixed deposit account is generally the safest way to invest. The returns are reasonable, and the investment is not vulnerable to market fluctuations. You can pick between two options with ICICI Tax Saving Fixed Deposit: Traditional and Reinvestment Plan.

You can also benefit from tax breaks on your savings. The interest on the Traditional Plan is paid monthly or quarterly. The interest on the Reinvestment plan is compounded quarterly and then reinvested with the principal amount.

Characteristics of the Tax Saving FD ICICI

  • A 5-year minimum lock-in term. Unlike other fixed deposits, you cannot withdraw before the lock-in term has expired.
  • The first deposit is Rs 10,000. Furthermore, the maximum amount in a fiscal year is Rs 1.5 lakhs.
  • A tax deduction of up to the amount of Rs 1.5 lakhs under Section 80C.
  • In the hands of the depositor, interest income is taxable.
  • An individual could open a fixed deposit account in his or her own name or jointly with another individual.
  • The primary account holder receives the tax benefit in the case of a joint account. Both of the account holders would have access to the fixed deposit receipt. The maturity amount will be paid to both account holders or any surviving account holders.
  • The depositor has access to a nomination facility.
  • A loan or overdraft feature is not available on an ICICI Tax Saver Fixed Deposit.
  • You can only make one lump-sum deposit in the ICICI Tax Saver FD. Auto-renewal of fixed deposit investment is allowed. When you deposit the initial deposit amount, you must select the maturity instructions.
  • The tax saver FD offers variable interest payout. You can choose between monthly, quarterly, or yearly interest payments, as well as principal reinvestment. If you do not require the cash inflow, it is best to reinvest it in the Principal. This is because reinvestment and the power of compounding allow you to earn more money.

ICICI Tax Saving FD Interest Rate

 

Depositor

ICICI tax saving FD rates

General Citizens

5.45%

Senior Citizens

5.95%

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Advantages of the ICICI Bank Tax Saving FD

  • Start small: As a new investor, you can start investing with as little as the amount of Rs 10,000.
  • Nominations: Whether the account is exclusively or jointly owned, you can name a nominee by completing a paper required by the Banking Companies Act.
  • Smallest lock-in period: At only five years, this FD has one of the shortest lock-in periods, during which you are not authorized to withdraw funds early.
  • Profits are guaranteed: Unlike riskier financial products, where earnings are determined by market conditions, you can expect predictable and dependable returns at a competitive interest rate.
  • Tax benefit: You could also claim tax deductions of up to Rs 1.5 lakh under Section 80C.

Who is Eligible for the ICICI Bank Tax Saving FD

The following are the fundamental eligibility criteria for creating a Tax Saver Fixed Deposit with ICICI Bank:

  • The applicant needs to be at least 18 years old.
  • The applicant must be salaried or self-employed.
  • The applicant must be an Indian citizen.

Taxes of the ICICI Bank Tax Saving Scheme

  • Interest income is taxed under "other sources of income."
  • The interest will be added to the depositor's gross total income earned throughout the financial year. It is taxed at the applicable slab rate for the fiscal year of the investment.
  • TDS Certificates will be mailed at the conclusion of each quarter during the fiscal year. The TDS certificate shows the amount of TDS deducted as well as the interest income.
  • TDS is taken when a customer's total interest due or reinvested on FDs and RDs across all branches reaches Rs 40,000. This amounts to Rs. 50,000 every fiscal year for senior citizens.
  • Section 206AA requires everyone who receives income from which TDS is deducted to give their PAN. If the depositor fails to provide the PAN, TDS will be deducted at a percentage of 20% rather than the existing rate. If your PAN is not updated with the bank or is incorrect, the bank will deduct TDS at the rate of 20%.

FAQs

Q1. Where should I go if I have a doubt about my account?

You can contact customer service by dialing 1860 120 7777 between 7:00 a.m. and 9:00 p.m.

Q2. I am an elderly person. Am I eligible for any further benefits?

Yes, seniors can receive a better rate of return on their savings. Senior people currently have an interest rate of 4.30% per annum.

Q3. What is the process for redeeming my FD for the tax-advantaged plan?

When your term deposit matures, you can go to any ICICI Bank branch and claim your deposit by showing the FD receipt.

Q4. How is the interest applied, and how frequently will it be received?

The interest on the Traditional Plan is credited to your savings account on a monthly or quarterly basis. The interest on the Reinvestment Plan is compounded to the principal amount. However, interest is only credited upon maturity.

Q5. Will I receive a receipt when I open my FD account?

Yes, you can obtain a receipt after you open an account. The bank will send it to the address you provide via courier.

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