Fixed Deposit It is one of the favorite savings schemes of Indians. FD has maintained its unique status even amidst the growing craze of mutual funds and stock market. Even today, most of the common people of the country consider fixed deposit as the safest investment. You get a fixed return with guarantee on your investment in FD. But if you are married and are planning to make a fixed deposit, then this news is only for you.
TDS has to be paid on interest received from FD
You have to pay TDS on the interest earned from fixed deposit i.e. FD. In such a situation, the income from FD will be added to your total income. Therefore, you will have to pay more tax. Now very few people pay attention to the fact that if they make an FD in the name of their wife, they can save a lot of tax.
How will you benefit from getting FD in your wife’s name
Generally, most women either fall in the lower tax bracket or they are housewives. Housewives are not liable to pay any kind of tax. In such a situation, if you make an FD in the name of your wife, then you will not only avoid paying TDS, but you can also avoid paying more tax.
TDS is deducted on returns of more than Rs 40,000
If the interest earned from FD is more than Rs 40,000 in a financial year, then you will have to pay TDS of 10 percent. If your wife’s income is less, then she can avoid paying TDS by filling Form 15G. If you make a joint FD with your wife and make her the first holder, then you can also avoid paying TDS as well as paying more tax.
