How to claim refund for Tax deductions on Bank interest?

My bank is deducting Tax from the interest I get from my FDs.How can they predict that the interest will cross 10000 limit.How can I claim the refund, if it falls below 10000

How to claim refund for Tax deductions on Bank interest?
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4 Replies to “How to claim refund for Tax deductions on Bank interest?”

  1. The Bank knows the principal and also know the interest rate on Fixed Deposit. If the total income from all Fixed Deposits in your customer identification number. If the total is estimated to cross 10000/- the software will automatically deduct depending on whether you have submitted you Permanent Account Number (PAN) .You can submit From NO. 15 H declaring that you have made adequate provision for payment of income tax or your income is below taxable limit not withstanding the fact the interest income from Fixed Deposit would be more than 100000/-.
    However if you want to claim refund you have to file the income tax return giving the full details of the income. In that Return you tax liability would be less than the Tax Deducted, you can claim the excess tax deducted as refund which the Income Tax Department would refund. Nowadays, for individuals, the income tax refund is coming pretty fast.

  2. Calculate your yearly interest before making fd’s since interest rate is known to you at the very beginning. If interest rate is 8% p.a then dont invest Rs 110000/- in fd for the whole year to avoid TDS.

  3. Only at the time of filing the return you will come to now about your tax liability. If the tax deduction is more than your liability, you can claim a refund in the Tax Return. In normal course, you will get the cheque from the department i claim is correct.

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