What is the tax implication on the proceeds from a bank recurring deposit?
Sarvesh Shastri, Hyderabad
Although the bank RD is a wonderful product that disciplines you to save a fixed sum regularly over time, the interest on the recurring deposit is added to your other income, if any, and taxed as per the slab system. No TDS is deducted for interest income up to Rs 10,000 in a financial year, but if the interest earned is more than this sum, the 10 per cent TDS will be deducted on the interest earned as well.
