These private banks offer senior citizens up to 7.10% returns on tax-saving FDs; Know details here

Tax-saving fixed deposits allow you to invest while saving money on taxes under Section 80C of the Income Tax Act. It is one of the most popular tax-saving choices. Tax-saving fixed deposits allow for up to Rs 1.5 lakh deductions per year, but only for a single account. A five-year lock-in term applies to tax-saving FDs.

Investors should be aware that interest earned on tax-saving deposits is taxable based on the taxpayer's tax bracket. TDS will be deducted when the interest earned or reinvested on tax-saving FDs reaches Rs 40,000 for regular customers and Rs 50,000 for senior citizens in a fiscal year.

As bank interest rates rise in the aftermath of the central bank raising the repo rate to 4.90 per cent in two tranches, investing in tax-saving fixed deposits could be a good option for those willing to make a five-year deposit without making premature withdrawals while also looking to save tax. Consider the three private banks that offer senior citizens up to 7.10 per cent returns on tax-saving fixed deposits.

Yes Bank
Yes bank's tax-saving fixed deposit requires a minimum deposit of Rs 1,000 and a maximum deposit limit of Rs 1,50,000 per fiscal year. This tax-saving deposit programme has a 5-year lock-in period and a nomination option. Yes bank provides tax-advantaged fixed deposit accounts that can be opened through internet banking, phone banking, or a local branch. With effect from June 6, 2022, Yes Bank offers a 7 per cent return on tax-saving fixed deposits to senior residents, while regular customers receive a 6.25 per cent return. These interest rates can be paid monthly or quarterly, and the account balance can be reinvested at maturity.

DCB Bank
A minimum deposit of Rs 1,000 and a maximum investment of Rs 1,50,000 is permitted in DCB Bank's tax-saving fixed deposit option. Premature withdrawal is not allowed from a DCB Bank tax-saver FD if the deposit is made for five years or more. As of May 21, 2022, DCB Bank will offer seniors a 7.10 per cent interest rate on tax-saving fixed deposits, while regular customers will receive a 6.60 per cent interest rate. DCB Bank does not allow automatic renewal of tax-saving fixed deposits, and no loans can be taken against the account.

RBL Bank
RBL Bank tax savings fixed deposit accounts can be opened multiples from Rs 100 to Rs 1,50,000. Its tax-saving FD also has a 5-year lock-in period and a nomination option. The RBL Bank Tax Savings Deposit Program, as the name implies, does not permit partial or premature withdrawal. In the case of joint deposits, tax benefits under 80C are available only to the primary holder. RBL Bank currently provides a 6.80 per cent return on its tax-saving FD scheme to elderly customers and a 6.30 per cent return to regular customers. These interest rates will take effect on June 8, 2022.

Note: Interest rates are obtained from banks' official websites.

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• FDs for senior citizens
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• RBL Bank
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• Yes Bank
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