HDFC Tax Saving FD

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HDFC Tax Saving FD

When it comes to investment, there are so many plans and schemes available for you to invest. One of the safest ways to invest your money is through fixed deposits. Different banks offer fixed deposits or term deposit schemes for you to start investing. 

One such bank is HDFC, which provides various investment opportunities. HDFC has certain FD (fixed deposit) schemes that offer tax benefits for investing the money. HDFC tax saving FD is one such scheme where an individual can invest in FD with tax savings and benefits.

What is HDFC Tax Saving FD

HDFC tax saving FD is one of the term deposit variants offered by HDFC Bank. In this plan, the tenure period is five years. Any depositor can enjoy the benefits of tax exemption on FD under section 80C of the Indian Income Tax Act, 1961. 

An individual can invest any amount from Rs.100 to Rs.1.5 Lakh. As the HDFC tax saving FD comes with a 5-year lock-in period, you cannot withdraw any funds from the deposited money within this timeframe. The rate of interest is like any other HDFC FD scheme, that is, 7.00% p.a. (per annum) for general citizens and 7.50% p.a. For the senior citizens.

Feature of HDFC Tax Saving FD

It is a 5-year tax saving FD scheme, where any normal or senior citizen can invest the money to unlock the tax benefits under section 80C. The salient features of HDFC tax saving FD are as follows:

  • Interest Income: The depositors have the option to receive the interest income on a monthly basis or quarterly basis. If you choose monthly interest pay-out, the monthly interest will get paid at discounted rates over the other fixed deposit rates.
  • Joint Account: The joint account deposit facility is available in HDFC tax saving FD. When any depositor holds a joint account, the tax benefits can be accessed by the primary account holder of the fixed deposit under section 80C
  • Reinvestment FD: In the case of reinvestments, the interest income is calculated on a quarterly basis. The principal amount for reinvestment is raised in order to include the earned interest in the previous quarter.
  • TDS: According to income tax regulations, the TDS is deducted when reinvested or payable interest on FD or RD exceeds the limit of Rs.40,000/- for general citizens and Rs.50,000/- for senior citizens. It is applied to all customers across all branches of HDFC in a financial year.
  • TDS Exemption: If any individual wants to be exempted or excluded from TDS on interest income of FD or RD, they need to submit Form 15 G/H. The form needs to be submitted either online or via your nearest bank branch in the first week of the new fiscal year.
  • Final Maturity Amount: The final amount an individual will receive may differ due to the compound effect on taxes over the time from deduction to the maturity amount. The fluctuation in the final total is possible because the final amount might be rounded off to the nearest 50 of each fiscal year.

HDFC Tax Saving FD Taxes

The taxes over the tax saving fixed deposit scheme are as follows:

  • An individual can invest up to Rs.1.5 lakhs, which is tax deductible as per Section 80C.
  • The money earned by an individual as an interest income on investing their money is considered a source of income and hence taxable. The earned interest income is added to the total earned income of an individual in a fiscal year and is taxed according to the tax slab an individual falls into. 
  • The availed TDS (Tax Deduction at Source) certificate by the HDFC tax saving FD is mailed to you during each fiscal year.
  • Under Section 206AA, for any individual receiving TDS deducted income, it is mandatory to give their PAN (Permanent Account Number). If anyone fails to provide their PAN card, the bank will deduct 20% TDS instead of the regular rate. 
  • Suppose an individual reaches a total interest income of Rs.40,000/- for regular citizens and Rs.50,000/- for senior citizens across all branches. In that case, the applied TDS is deducted from the earned interest income.
  • When the fiscal year concludes, the TDS is deducted from the accrued interest.

TDS Deduction on HDFC Tax Saving FD

  • If an individual resides in India, the TDS on earned interest income can be avoided.  The individual can submit a 15H or 15G Form from the bank as per the criteria they fit in, and the tax on the income will be exempted for the fiscal year. The PAN card must be compulsorily submitted to your nearest HDFC branch.
  • An individual must submit three copies of Form 15H/ G to the HDFC bank. One copy for the income tax department, one copy for the bank, and one for you to keep to yourself.
  • An investor must submit a new form 15H/ G for each fiscal year in order to continue getting benefits of TDS exemption. In case anyone submits the 15H/ G form after the interest is credited, the tax deduction immediately precedes the date of filing the form.
  • If an individual wants to claim the TDS exemption, they must submit an individual 15H/ G Form for each FD with the HDFC bank.
  • If an individual fails to submit form 15H/ G on time, the bank by any means is not responsible for any consequences a customer may have to pay.

Eligibility Criteria and Documents Required for HDFC Tax Saving FD

The eligibility criteria for any individual, including senior citizens wanting to invest in this scheme, are as follows:

  • Indian Resident Individuals
  • HUF (Hindu Undivided Families)

To open an HDFC tax saving FD, any customer needs to have the following documents:

  • The Aadhar card of the individual
  • The PAN card of the individual
  • Proof of age for senior citizens
  • Passport of the individual
  • Voter ID card of the individual
  • LIC policy 
  • 10th standard certificate of the individual


Different banks in India offer many exciting opportunities where investors can deposit their money in the schemes. HDFC tax saving FD is one such plan with a tenure of 5 years. Any individual or senior citizen can invest in this plan and achieve tax exemption according to Section 80C by investing as small an amount as Rs.100/-, which can go up to Rs.1.5 lakhs.

There are many factors involved before investing in a fixed deposit. One must conduct detailed research on any scheme before investing their hard-earned money. Decide on the amount of money you are ready to invest and the time period of the investment. Compare certain schemes available in the market to find the perfect investment plan that suits you.