AU Small Finance Bank Tax Saving FD

What is an AU Small Finance Bank Tax Saving FD?

AU Small Finance Bank Tax Saving FD is a fixed deposit scheme that allows investors to save taxes while earning assured returns. You can start with a minimum deposit of ₹1,000 and invest up to a maximum of ₹1,50,000 in a financial year under Section 80C. The scheme offers 6.75% interest for general investors, while senior citizens can earn up to 0.50% p.a. extra, making the rate 7.25%. Tax-saving fixed deposits come with a mandatory lock-in period of 5 years.

How Does an AU Small Finance Bank Tax Saving FD Work?

Here’s a simple understanding of how Tax Saving FD AU Small Finance Bank works, step by step:

• Open the FD: Apply through AU 0101 App, NetBanking, Video Banking, or by visiting a branch.
• Deposit the Amount: Invest between ₹1,000 and ₹1.5 lakh in a financial year, per Section 80C of the Income Tax Act.
• Lock-in Period: The deposit is locked for 5 years, and premature withdrawal is prohibited.
• Interest Calculation: Interest is calculated at the applicable fixed rate; senior citizens receive 0.50% extra.
• Interest Payout: Choose between cumulative at maturity or monthly, quarterly interest payout options.
• Maturity: At the end of 5 years, you receive the principal amount and accumulated interest.

AU Small Finance Bank Tax Saving FD Highlights

Here are the key highlights of the AU Small Finance Bank Tax Saver FD:

How to Open an AU Small Finance Bank Tax Saving FD?

AU Small Finance Bank allows customers to complete the application process online or offline as per their preference.

1. Online FD Booking

   You can open an AU Small Finance Bank Tax Saving FD quickly through digital channels without visiting a branch.

   • Visit the AU Small Finance Bank Website/App: Access the AU 0101 App, NetBanking, or use Video Banking.
   • Log In or Open Account: Sign in to your account or register as a new customer.
   • Navigate to the Fixed Deposit Section: Select the Tax-saving FDs option.
   • Enter Investment Details: Provide the investment amount and tenure (5 years).
   • Choose Interest Payout: Select cumulative or monthly, quarterly interest payout options.
   • Complete KYC Verification: Ensure PAN and Aadhaar/KYC are updated. You only need your PAN card and Aadhaar card for Video Banking.
   • Confirm and Submit: Review details, submit your application, and receive the FD receipt digitally.

2. Offline FD Booking

   You can also open a Tax Saving Fixed Deposit AU Small Finance Bank by visiting your nearest branch. Follow these simple steps:

   • Visit the Branch: Go to the nearest AU Small Finance Bank branch.
   • Fill Out the Application Form: Complete the Tax Saving FD form provided at the branch.
   • Submit Required Details: Provide your PAN, ID proof, and address proof for verification.
   • Make the Deposit: Pay the chosen amount through cheque, cash, or account transfer.
   • Receive FD Receipt: Collect the FD receipt as confirmation of your investment.
   • Verify Records: Ensure all details are accurate and keep the receipt safely for future reference.

Who Should Consider AU Small Finance Bank Tax Saving FD?

The following types of investors can benefit from the AU Small Finance Bank Tax Saving FD:

• Tax Savers: Investors looking to claim deductions under Section 80C up to ₹1.5 lakh.
• Individuals & HUFs: Both resident individuals and Hindu Undivided Families are eligible.
• Senior Citizens: They enjoy a higher interest rate than regular investors, earning up to 0.50% p.a. more.
• Safety-Focused Investors: Designed for people who prioritise guaranteed returns over taking investment risks.
• Long-Term Planners: Suitable for depositors planning disciplined savings with a five-year lock-in period.

Tax Deductions for AU Small Finance Bank Tax Saving FD

Investments of up to ₹1.5 lakh in an AU Small Finance Bank Tax Saving FD are eligible for tax benefits under Section 80C of the Income Tax Act. The interest earned is taxable as per your income slab, and Tax Deducted at Source (TDS) is deducted if the interest exceeds ₹50,000 in a financial year and ₹1,00,000 for senior citizens. You can avoid TDS by submitting Form 15G or 15H if your income exceeds the taxable limit. Providing your PAN is mandatory for proper TDS credit and certificate.

Key Takeaways

The AU Small Finance Bank Tax Saver FD is a reliable tax-saving investment option and disciplined investing. You can invest a minimum of ₹1,000 and a maximum of ₹1.5 lakh per financial year. Investments are eligible for deductions under Section 80C. The rate of interest on tax-saving FD is 6.75% for regular investors. Senior citizens earn 7.25%, which is 0.50% higher. The scheme has a 5-year lock-in period. Premature withdrawal and loan against FD are not allowed. It provides guaranteed returns and can be opened online and offline.