If you want a safe and intelligent investment, fixed deposit is the one to go for. These days, fixed deposits are high on popularity after the increase in interest rates in the last few years. A huge sum of money deposited for a certain period of time can earn a pre-determined rate of interest. These schemes are offered by both banks and companies, but it is wise to opt for banks, because of safety reasons. Here are few things that you should keep in mind about fixed deposit accounts in India.

12. Tax Deduction – You’ve got some News Here

Fixed Deposits up to Rs. 1 lakh taken for a period of 5 years are eligible for deduction of taxable income under Section 80C. This should be good news for small investors who are looking for some investment as well as tax redemption.

11. Tax in FD is adjusted, it’s not Free

The interest you earn from Fixed Deposits is tax adjusted, not tax free. The interest income is taxable under the head “Income from Other Sources” and you pay tax depending on the tax slab you belong to. Interest income from Fixed Deposits up to Rs. 10,000 is exempted from tax.