State Bank of India i.e. SBI has launched a new Recurring Deposit (RD) scheme. Each house is named after Lakhpati. Under this scheme, you will be able to deposit one lakh rupees or more into your account by depositing small amounts every month. Within this framework, a maximum annual interest of 6.75% is granted to citizens in general and a maximum annual interest of 7.25% is granted to elderly people.
First of all, understand what RD is? Recurring Deposit or RD can help you save big. You can use it as a piggy bank. This means that you continue to pay a fixed amount into it every month when your salary comes and when it comes due, you will have a huge sum in hand. The maturity period of each domestic lakhpati generally lasts from 3 to 10 years. This means you can invest for 3 to 10 years.
Who can invest in it Any Indian citizen can invest in this program. Individuals can open a single or joint account. While parents (guardians) can open an account with their child (over 10 years old and able to sign clearly).
Tax is levied on interest earned on RD If the interest income from recurring deposit (RD) is up to Rs 40,000 (Rs 50,000 for senior citizens), then you do not have to pay any tax on this amount. If the income is more than this, 10% TDS is deducted.
If not taxable, submit Form 15H-15G. If your annual interest income from RD is more than Rs 40,000 (Rs 50,000 in case of senior citizens), but your total annual income (including interest income) does not reach the limit where it’s taxable, so the bank doesn’t do it. deduct TDS Est.
For this, senior citizens need to submit Form 15H and others need to submit Form 15G to the bank. Form 15G or Form 15H is a self-declaration form. In this, you declare that your income exceeds the tax ceiling. Click for more information on the Har Ghar Lakhpati program