New Delhi:
Fixed Deposit: Most people like to invest in fixed deposits, because they provide fixed returns and your investment amount remains safe. But if you want to get more returns on fixed deposit, then there is a way for this too. Often people get FD made in their wife’s name to save tax. If you want to get maximum returns on FD, then making a fixed deposit in the name of your mother instead of your wife can prove to be a better way.
By making an FD in your mother’s name, you can get higher interest and many other benefits. Let us tell you today about the benefits of getting an FD in your mother’s name.
Benefit of Higher Interest
You can definitely save tax by getting an FD in your wife’s name, but note that you will get the same interest on it as you would have got if you got an FD in your name. But if you make FD in your mother’s name, you can earn more interest on it. But pay special attention to the fact that if your mother’s age is 60 years or more, that is, she is a senior citizen, then only by making an FD in her name, you can get the benefit of 0.50 percent higher return.
Whereas if your mother’s age is 80 or more i.e. she is a super senior citizen, then you can get 0.75 to 0.80 percent more interest. For higher returns, you can make FD in the name of your mother or father. Actually, senior citizens get higher returns on FD.
Benefit of relaxation in TDS limit
Let us tell you that TDS (Tax Deducted at Source) is deducted on the income from FD. If the interest received from FD in a financial year is more than Rs 40,000, then you will have to pay TDS of 10%. But for senior citizens this limit is Rs 50,000.
You can also reduce your tax liability
If you invest in FD in your name, then the income from it is added to your income. That means in such a situation you may have to pay more tax. Therefore, if you make an FD in your mother’s name, you will not only get higher returns but you can also save your tax in this way.
If your mother is a senior citizen and does not have any other income or comes in a lower tax bracket, then you can get all these benefits by making an FD in her name. In most families, women either fall in the lower tax bracket or are home makers. Therefore there is no tax liability on them.