Tax applicable on Corporate Fixed Deposits

POSTED BY itsvibhor ON September 23, 2013 2:52 pm ONE COMMENT

I’m in the 30% tax bracket; Assuming I invest 1 Lakh in a corporate FD for 5 years @ 10% rate – the maturity amount comes to about Rs 1.61 Lakhs. How is the tax calculated at the end of maturity – is it 10.3% on the total interest earned in 5 years (Rs 16K tax on Rs 61,000 interest)?

Also, is the above calculation valid for investing amount up to 10 lakhs?

Thank You.

One reply on this article “Tax applicable on Corporate Fixed Deposits”

  1. ashalanshu says:

    Dear Vibhor, as it’s corporate FD, any interest more than 5000 Rs. in a FY is liable to TDS. hence in each FY, you w’d have to pay that 30% Tax. Calculate your final maturity now.

    Thanks

    Ashal

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