City Union Bank Tax Saving FD

What is a City Union Bank Tax Saving FD?

City Union Bank Tax Saving FD is a fixed deposit offered by City Union Bank that helps depositors save taxes while earning assured returns. The bank offers two types of Tax Saving FDs: Tax Saver Silver and Tax Saver Gold. The Tax Saver Silver accepts deposits starting from ₹100, while the Tax Saver Gold accepts deposits from ₹1,000. 

The maximum investment is ₹1.5 lakh per financial year, which qualifies for tax exemptions under Section 80C of the Income Tax Act. Both plans offer an interest rate of 6.25% for both regular investors and senior citizens. However, unlike regular FDs, the Tax Saving FDs have a mandatory 5-year lock-in period, meaning you cannot withdraw your deposit before maturity.

How Does City Union Bank Tax Saving FD Work?

Here’s a simple breakdown of how Tax Saving Fixed Deposit City Union Bank works, step by step:

• Open the FD: Apply online through net banking or visit a City Union Bank branch.
• Deposit the Amount: Invest between ₹100 and ₹1.5 lakh in a financial year as per Section 80C of the Income Tax Act.
• Lock-in Period: The deposit is locked for 5 years, and early withdrawal is not allowed.
• Interest Calculation: The interest is calculated on the deposit amount at the applicable fixed rate.
• Interest Payout: Choose from monthly, quarterly, or reinvestment options for interest payouts.
• Maturity: After 5 years, receive the principal amount along with accumulated interest.

City Union Bank Tax Saving FD Highlights

Here are the key highlights of the City Union Bank Tax Saving Fixed Deposit presented in a clear table for easy reference:

How to Open a City Union Bank Tax Saving FD?

The application process for a City Union Bank Tax Saving FD is simple and can be done online or offline.

1. Online Application

   To apply for the City Union Bank Tax Saving FD online, follow these simple steps:

   • Visit City Union Bank Website or Mobile App: Access the official website or the CUB All in One Mobile App to start your Tax Saving FD application.
   • Log In or Open Account: Sign in to your net banking account or create a new account if you're a first-time user.
   • Navigate to Fixed Deposit Section: Go to the Fixed Deposit section and select the Tax Saving FD option.
   • Enter Investment Details: Enter the investment amount and select the 5-year tenure.
   • Choose Interest Payout: Select your preferred interest payout option.
   • Complete KYC Verification: Verify your KYC details if not already completed.
   • Confirm and Submit: Review and confirm all details, then submit your application to receive the FD receipt via email.

2. Offline Application

   For those who prefer to apply in person, follow these steps to complete your Tax Saving FD application offline:

   • Visit the Branch: Go to your nearest City Union Bank branch to begin your Tax Saving FD application.
   • Collect Application Form: Request the Tax Saving FD application form from the bank staff.
   • Fill Out the Form: Carefully complete the form with accurate personal and deposit details.
   • Submit Required Documents: Provide ID proof, address proof, and PAN card for verification.
   • Deposit Investment Amount: Pay the chosen FD amount via cheque, cash, or transfer from your account.
   • Collect FD Receipt: Obtain the FD receipt as proof of your investment.

Who Should Consider City Union Bank Tax Saving FD?

The following types of investors can benefit from investing in Tax Saving FD City Union Bank:

• Tax Savers: Customers looking to reduce taxable income while ensuring secure, fixed returns.
• Residents of India: Only Indian residents are eligible to invest in this FD.
• HUFs: Hindu Undivided Families (HUFs) are also eligible to invest.
• Risk-Averse Investors: Depositors seeking a stable, risk-free investment.
• Long-Term Savers: Investors looking to plan disciplined savings over a 5-year tenure.

TDS on City Union Bank Tax Saving FD

The Tax Deducted at Source (TDS) on interest from the City Union Bank Tax Saving FD is applicable when the total interest exceeds ₹50,000 in a financial year, ₹1,00,000 for senior citizens. Residents can avoid TDS by submitting Form 15G or Form 15H. TDS is applicable only if the PAN details are updated with the bank. These forms must be submitted to ensure that TDS is not deducted, provided the PAN details are updated with the bank. It is important to ensure that the total income does not exceed the taxable limit to avail this benefit.

Key Takeaways

City Union Bank Tax Saving FD is an effective way to save taxes while earning fixed returns. It offers tax benefits under Section 80C, with a 5-year tenure. The rate of interest of the Tax Saving FD is 6.25% for both regular investors and senior citizens. Tax Saver Silver accepts a minimum deposit of ₹100, while Tax Saver Gold requires a minimum deposit of ₹1,000. This FD can be opened both online and offline, offering convenience for all investors. While premature withdrawal is not allowed, it is a reliable tool for disciplined long-term savings and tax planning.