The financial year-end is around the corner and it is about time you start your tax saving investment. For those who’ve not yet planned their tax savings, here’s an tax saving investment scheme from the SBI (State Bank of India).
The SBI’s tax saving investment scheme is actually a fixed deposit scheme, which is known as the SBI Tax Saving Scheme 2006. As per the bank’s website, Resident Indians and karma of a Hindu Undivided family are eligible to apply to this scheme. To avail the benefit, you will also need to have PAN (Permanent Account Number). Applicants can avail tax benefit of up to Rs. 1.50 lakhs by investing in this scheme under Sec 80C of the Income tax act.
The details of the Tax Saving Investment Scheme offered by the SBI is as given below:
The minimum amount for the taxing saving scheme is Rs. 1000, whereas one can deposit a maximum amount of Rs. 150000 per annum. The deposit will have a tenure of 5 years to 10 years. The deposit will carry an interest rate of 6% for individuals and 6.5% for senior citizens. However, premature withdrawal of the deposit is not permitted before 5 years since this is a tax saving investment scheme.
Also, one cannot use this term deposit to avail loan or offer this account as security towards loan or asset.
In case the interest earned in a financial year exceeds Rs. 10000, the amount is subjected to TDS of 10%. Like any other Term Deposit account, the tax saving account also offers a nomination facility. Also, if you opt for an automatic renewal option, the FD will be renewed automatically.
For those aspiring to use SBI’s tax saving scheme, you can open an FD online by logging into the bank’s website. You will need to create a username and password first if you are not already an SBI customer.
Next, from the menu, choose the option e-fixed deposit and select the option e-TDR/eSTDR. Input the amount and choose the tenure as per your choice. In case you are a senior citizen, select that option to enjoy higher interest rate. You will also need to select the maturity instruction such as if you’d like an auto-renewal of the FD on maturity.
Documents required to open an FD under the Tax Saving investment scheme include an Application form, 2 passport size photos, Address proof, ID proof, Pan Card copy and details of Aadhaar card.