Axis Bank Tax Saving FD

What is an Axis Bank Tax Saving FD?

Axis Bank Tax Saving FD offers the dual benefit of tax saving and fixed returns. You can invest a minimum of ₹100 and up to ₹1.5 lakh in a financial year, with deposits eligible for deduction under Section 80C of the Income Tax Act, 1961. The scheme comes with a fixed 5-year lock-in period, during which premature withdrawal and loans against the FD are not allowed. The Tax Saving FDs interest rates are 6.6% for regular customers and 7.35% for senior citizens. Senior citizens enjoy a preferential rate, which is typically 0.25% to 0.5% higher than the standard FD rates.

How an Axis Bank Tax Saving FD Works

To better understand Tax Saving FD Axis Bank, here’s a step-by-step explanation from deposit initiation to maturity:

• Opening the Account: Choose Tax Saving Fixed Deposit Axis Bank and deposit a fixed amount from ₹100 up to ₹1.5 lakh in a financial year, as per Section 80C.
• Lock-In Period: Your funds remain locked for 5 years, and no premature withdrawal or overdraft is permitted.
• Interest Earnings: The deposit earns interest at Axis Bank’s prevailing FD interest rates, with payout options such as monthly, quarterly, or reinvestment.
• Maturity Benefits: On completion of 5 years, Axis Bank credits the principal amount along with accrued interest directly to your linked savings account.

Axis Bank Tax Saving FD Highlights

Here are the major highlights of Axis Bank’s Tax Saving FD scheme:

How to Open an Axis Bank Tax Saving FD?

You can conveniently open an Axis Bank Tax Saver FD through both digital platforms and offline branches.

1. Online FD Booking

   To open an Axis Bank Tax Saver FD online, simply follow these steps:

   • Log In: Access your Axis Bank Internet Banking account.
   • Navigate to Deposits: Select the ‘Deposits’ section from the menu.
   • Choose Tax Saver FD: Pick the ‘Tax Saver FD’ option.
   • Enter Investment Details: Specify the deposit amount and interest payout frequency.
   • Review Details: Verify tenure, FD interest rate, and linked account information.
   • Complete Application: Confirm the request, and the FD will be instantly created with an online acknowledgment.

2. Offline FD Booking

   If you prefer visiting the bank, here’s how you can apply for an Axis Bank Tax Saver FD offline:

   • Visit a Branch: Go to your nearest Axis Bank branch.
   • Get the Form: Request the Tax Saving FD application form.
   • Provide Documents: Fill the form and attach KYC proofs like PAN, ID proof, and address proof.
   • Make Deposit: Submit the form with the deposit via cheque, cash, or transfer.
   • Receive Receipt: Collect the FD acknowledgment slip from the bank.
   • Link Account: Ensure your savings account is linked for smooth credit of maturity proceeds.

Who Should Consider Axis Bank Tax Saving FD?

Axis Bank Tax Saving FD is designed for specific categories of investors who seek safety, discipline, and tax-saving benefits. These may include:

• Tax-Savers: Suitable for depositors looking for Section 80C deductions, combining tax savings with assured returns from a safe investment option.
• Conservative Investors: Best for those preferring steady, risk-free returns instead of exposure to volatile market-linked investment products or schemes.
• HUFs: Hindu Undivided Families are eligible to invest, enabling collective tax planning and wealth preservation through guaranteed returns from deposits.
• First-Time Depositors: A secure choice for beginners entering investments, offering guaranteed growth and stability without risks associated with market fluctuations.
• Salaried Employees: Suitable for salaried investors to save taxes annually while simultaneously building wealth through assured returns from fixed deposits.

TDS on Axis Bank Tax Saving FD

Deposits made in Axis Bank Tax Saver FD qualify for deductions under Section 80C of the Income Tax Act, with a maximum cap of ₹1.5 lakh per financial year. However, the interest income is fully taxable as per your income tax slab. Tax Deducted at Source (TDS) will apply if the annual interest exceeds ₹50,000 (₹1,00,000 for senior citizens).

Form 15G and Form 15H are self-declaration forms that help customers avoid TDS on FD interest, provided their total income falls below the taxable limit. But, if the projected interest from all fixed deposits in a financial year exceeds the exemption limit under Section 197A(1B), TDS will be deducted even if these forms are submitted.

Key Takeaways

Axis Bank Tax Saving FD comes with a 5-year lock-in period, where investors can claim up to ₹1.5 lakh deduction under Section 80C. The FD interest rates depend on the deposit tenure and the category of the customer. While the interest earned is taxable and subject to TDS, the rate of interest of Tax Saving FD is determined by the bank and can be revised periodically. Investors can open this deposit conveniently through both online and offline modes.