Hi,
Last year in February, I earned 5 lacs. To use this money in hour of need, I deposited in a bank FD of 19 months @9.25%. I also have a home loan running and current outstanding principal is around 8 lacs with ROI 10.5%.
Now I came to know that the interest on Bank FDs is taxable. Now I feel sorry that I should have made a pre-payment of the home loan. That way the money would have been put to best use.
As of today, there are 7 months remanining for the FD to mature.
So, at this moment,
1. Should I break the FD and make a pre-payment of the home loan or should I wait for the FD to mature?
2. How much tax will I have to pay on maturity?
Pls advise.
Thanks in advance.
Regards