Tds on bank fds

This query is : Resolved

Varun Saboo (Querist)
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19 April 2015
I am aware of the following Rules for Deduction of TDS on interest paid / accrued :

As per present income tax guidelines, banks are required to deduct tax at source (TDS) on deposits if the total interest earned on all your fixed deposits in a bank (at all branches of the bank) is more than Rs.10,000 in a financial year. (as per these guidelines even if a fixed deposit is in the name of a minor TDS is deducted).
However, the depositors can claim the credit for such TDS in their income tax returns.

My query is this: When will the Bank will deduct & pay TDS to the Govt? Will it be at the time of maturity of FD? If yes, do I have to pay advance tax on FDs in banks ? Please help.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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19 April 2015 There are a number of incidences in which most of the banks, (exception : Private Banks like HDFC, ICICI, Axis etc) have not followed the TDS rules properly.
.
As per the provisions of the Act, banks are required to deduct TDS at the time of credit of the interest (as the same is earlier than the maturity payment date.)
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It's upon you whether to pay advance tax or not looking to the irregularities in TDS by banks.However, at that time you may confirm with your bank for the TDS amount.
.

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