For senior-citizens, investing in fixed deposits is a good option for saving money. These schemes offer the elderly people with attractive returns on fixed deposits while also benefiting from tax exemptions.
For senior-citizens, investing in fixed deposits is a good option for saving money. These schemes offer the elderly people with attractive returns on fixed deposits while also benefiting from tax exemptions. Let’s learn about these schemes in more detail.
1. The fixed deposit scheme is considered an excellent option for investment in old age. It provides tax exemptions along with substantial returns upon maturity. Moreover, tax deductions are applicable on the interest earned from FDs.
2. Senior citizens can avail discounts of up to Rs 1.5 lakh. In the fixed deposit scheme, they also benefit from exemptions under Section 80C.
3. Elderly above the age of 60 years can claim deduction of up to Rs 50,000 every financial year.
4. Senior citizens can opt for Fixed Deposit (FD) for a duration for 5 years. This is called a cumulative FD, where interest is paid on maturity after the completion of the 5-year period.
5. In the unforeseen circumstance of senior citizen’s death before the maturity of the FD, only the nominee is permitted to withdraw the funds from the account.
6. For FDs, the interest exceeding Rs 40,000 annually is taxable. However, senior citizens benefit from an exemption of up to Rs 50,000 on the interest earned from such FDs.
7. After the fixed deposit reaches maturity, the bank gives the payment to the customers after deducting TDS.
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