₹ TaxSetu 2025
Other Sources — Interest & Dividends

Interest & Dividend Tax: FD, Savings, NSC, Post Office + TDS Limits

FD/RD interest: slab + TDS above ₹50k (₹1L seniors). Savings: 80TTA ₹10k (old-only). Post-office savings: ₹3,500/₹7,000 exempt. NSC interest = reinvested 80C (except last year). Dividends: slab + TDS above ₹5k.

Every interest type, taxed

IncomeTaxTDS / shield
FD / RD interest (bank, NBFC, company)Slab10% TDS above ₹50k/yr (₹1L seniors, banks/PO)
Savings account interestSlab80TTA: ₹10k off (old regime, non-seniors)
Post-office savings accountExempt ₹3.5k/₹7k (single/joint)Over and above 80TTA
PPF / SSY interestExemptBoth regimes; EEE
NSC interest (accrued yearly)Slab, but reinvested = 80CExcept final year (no reinvestment left)
KVP / MIS / post-office TDSlabNo 80C; TDS per thresholds
Dividends (shares + MF IDCW)Slab10% TDS above ₹5k/yr per payer
Stop TDS legally: Form 15G (under 60, tax nil) / 15H (60+, tax nil) every April. 15G/15H rules → · Seniors: 80TTB ₹50k →

80TTA vs 80TTB + TDS triggers (the full picture)

RuleUnder-60Senior citizen (60+)
Savings-account interest deduction₹10,000 (80TTA)₹50,000 combined (80TTB: savings + FD + post office)
FD/post-office interest deductionNil
Bank-FD TDS trigger (Budget 2025)₹50,000/yr₹1,00,000/yr
Dividend TDS trigger₹10,000/yr per company (10%)
  • NSC trap: NSC interest is taxable EVERY year (even though you don't receive it) — but the reinvested interest (except the final year) counts toward 80C. Miss declaring it yearly and the maturity year becomes a mess.
  • 15G/15H in April, not March: file the no-TDS declaration at the START of the year with every bank. Filing in March saves nothing — the TDS is already cut.
  • Senior with ₹45,000 FD interest? 80TTB wipes it fully — plus no TDS below ₹1L. The senior interest stack is genuinely generous; use all of it.
⚠️ Mistake we see: 'no TDS = no tax' on post-office interest
Post-office MIS/RD interest has no TDS cut — but is fully taxable at slab. Thousands of filers skip it ('bank didn't cut TDS, so it's exempt') and manufacture AIS mismatches. Same for savings interest above 80TTA's ₹10k and P2P-lending interest. Rule: TDS is the bank's duty; REPORTING is yours. Declare everything, claim 80TTA/80TTB properly, sleep well.

By TaxSetu Editorial Team · Last reviewed: 7 October 2026

Based on the Income-tax Act 2025, Income Tax Rules 2026 and CBDT notifications; sections per the Income-tax Act 1961 (as amended) with 2025-Act mappings where notified · Verify on the official portal: incometax.gov.in

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Frequently Asked Questions

10% TDS above ₹50,000/year per bank (₹1 lakh for seniors, banks/co-op/post office); other-case interest above ₹10,000. File 15G/15H if your tax is nil. 15G/15H.

Effectively yes in the old regime via 80TTA (non-seniors). Seniors get the bigger 80TTB ₹50k. 80TTB.

Taxable yearly at slab, but deemed reinvested — so it qualifies for 80C except in the final year.

Yes, at slab rate, with 10% TDS above ₹5,000/year per payer.