Now Reading: FD and KVP interest remains taxable under 2025 tax law
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FD and KVP interest remains taxable under 2025 tax law
Interest from fixed deposits and Kisan Vikas Patra will remain taxable under the Income Tax Act, 2025, which applies from 1 April 2026, Livemint reports. Both are taxed under “Income from Other…
The Story in Brief
Interest from fixed deposits and Kisan Vikas Patra will remain taxable under the Income Tax Act, 2025, which applies from 1 April 2026, Livemint reports. Both are taxed under “Income from Other Sources” at the investor’s applicable slab rate.
Banks must deduct tax at source on FD interest once the prescribed threshold under Section 393 is crossed, including interest accrued on cumulative deposits. KVP interest does not attract TDS, but investors must still report the full taxable amount in their income tax returns. TDS is only advance tax collection and does not settle the final liability, which depends on total income and the applicable slab.
The Indian Opinion
The lazy assumption that no TDS means no tax is especially risky for KVP investors. The opposite mistake is also common: treating bank deductions as the final bill. Both products need a proper interest calculation and reconciliation with the return. Investors should check the prescribed FD threshold, accrued interest and their slab before filing. The final tax payable, not the TDS certificate alone, will settle the issue.
Source: livemint.com
This story was synthesised by AI from the source linked above.
