FD Update: FD holders Don’t do this mistake, otherwise 20% TDS will be deducted, Check details

By
Sunil Kumar
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Bank Released New FD Interest Rates: This bank increased interest on fixed deposits, now getting interest at 9.1%
Bank Released New FD Interest Rates: This bank increased interest on fixed deposits, now getting interest at 9.1%

FD Update- Now you will not be allowed to submit Form 15G/H for your Fixed Deposits and it will attract TDS of 20% instead of 10%. Read the complete news to know the complete details related to this update.

If you have not linked your PAN with your Aadhaar, then at present your PAN has become in-operative. Actually, the last date to link PAN with Aadhaar was June 30, 2023. Therefore, you will no longer be allowed to submit Form 15 G/H for your Fixed Deposits and TDS will be charged at 20% instead of 10%.

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According to the HDFC Bank website, “If PAN is not linked with Aadhaar, such PAN will become in-operative from 1st July 2023 and the customer will not be allowed to submit Form 15G/H and Higher TDS deduction will be applicable for non-operative PAN.
Diet on Fixed Deposit If you earn more than Rs 40,000 interest in a financial year, then you will have to pay TDS on FD. This limit is Rs 50,000 for senior citizens.

As per the rules of the Income Tax Act, 1961 (‘Act’), every person who has been assigned PAN as on 1st July, 2017, and is entitled to obtain an Aadhaar number, shall do so on or before 30th June, 2023, on payment of the prescribed fee. It is necessary to inform the prescribed authority first.

FD investors will be affected-

  • TDS will be charged at 20%.
  • No TDS credit from Income Tax Department.
  • As per CBDT circular no: 03/11, no TDS certificate will be issued.
  • Form 15G/H and other exemption certificates will be invalid and penal TDS will be applicable.
  • However, PAN can be reactivated within 30 days by intimation of Aadhaar to the prescribed authority after payment of a fee of Rs 1,000.

Disadvantages of not linking Aadhaar-PAN-

  • No refund will be given for in-operative PAN
  • Interest will not be payable on such refund for the period during which the PAN remains in-operative
  • In case of in-operative PAN, higher rate will be applicable on TDS/TCS deducted.

Apart from this, you will not be able to take advantage of many banking services, such as –

  • Investing in FDs above Rs 50,000
  • Deposit more than 50,000 cash
  • Getting a new credit or debit card
  • Invest in or redeem your mutual funds.
  • Buying any foreign currency above Rs 50,000.
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