Sreekanth (Student) (8 Points)
26 December 2020I have a query regarding payment of income tax on the interest earned on Fixed Deposits.
Suppose during the FY 2018-19 the bank had deducted tax on both the interest credited to the account as well as the accrued interest. During the next FY 2019-20 the accrued interest will be paid to the account on the maturity of the deposit and the bank would again deduct Tax on the interest paid.
Wouldn't it be taxing the same interest income twice?
JATINDER KUMAR
(Accountant)
(3662 Points)
Replied 26 December 2020
ayusmita
(Tax consultant)
(5885 Points)
Replied 27 December 2020
Sreekanth
(Student)
(8 Points)
Replied 27 December 2020
Thanks Jatinder Kumar for the reply.
When I looked into the Deposit Interest Certificate issued by the bank, there is interest paid and interest accrual and 10% tax has been deducted on the combined amount, not just on the accrued amount.
CAclubindia
