Tax On Savings Account Interest: What You Need To Know​

Savings accounts offer guaranteed interest income on the balance you maintain. However, there’s a tax implication attached to it. let’s decode

Section 80TTA

Under Section 80TTA of the Income Tax Act of 1962, savings account interest is tax-free up to ₹10,000 in a financial year.

This limit applies to the cumulative interest earned across all savings accounts that you might own across different banks. 

Section 80TTB

Section 80TTB of the Act provides an enhanced exemption limit for senior citizens. The tax-free interest under the section is ₹50,000.

The limit includes the aggregate interest earned from savings accounts and deposits, including fixed and recurring deposits. 

NRIs can enjoy tax-free interest from NRE accounts, but NRO accounts incur the same taxation.

Understand the tax implication of savings account for efficient tax planning. Open an IDFC FIRST Bank Savings Account and watch your savings grow.