Is RD maturity amount taxable

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  1. pancham singh

    pancham singh New Member

    Hi,
    From the posts, its quite clear that interest earned on RD is taxable as other source of income. But, i have received the full RD maturity amount in my account. Do i still need to pay tax for this.
    FYI: My taxable income is 1.5 Lakh and the RD maturity amount is 1.74 L. Pls help to understand.
    Thanks
     
  2. ZED

    ZED Well-Known Member

    Was tax not deducted? Were you issued interest certificate and TDS certificate.
     
  3. V K Khanna

    V K Khanna Active Member

    Only interest earned on RD account is taxable and not the amount you invested. The post office neither deduct TDS nor issue interest certificate. From the maturity amount received, you can work out how much interest you have received and offer the same to tax.
     
    ZED likes this.
  4. ZED

    ZED Well-Known Member

    But sir, if interest is more than 10k then even post office is liable to deduct tax. In this case, interest is atleast 24k.
    (unless form 15 G/H was submitted, there should have been TDS)

    Please explain if I am mistaken.

    S.194A(3) The provisions of sub-section (1) shall not apply—

    (i) where the amount of such income or, as the case may be, the aggregate of the amounts of such income credited or paid or likely to be credited or paid during the financial year by the person referred to in sub-section (1) to the account of, or to, the payee, does not exceed—

    (a) ten thousand rupees, where the payer is a banking company to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution, referred to in section 51 of that Act);

    (b) ten thousand rupees, where the payer is a co-operative society engaged in carrying on the business of banking;

    (c) ten thousand rupees, on any deposit with post office under any scheme framed by the Central Government and notified by it in this behalf;
     
  5. V K Khanna

    V K Khanna Active Member

    [email protected],
    I have gone through all post office saving schemes,but find that the provision of TDS if interest amount exceeds Rs 10,000, exists only in one scheme I e. Senior Citizen Saving Scheme. Even 5 year Time deposit scheme which qualifies for deduction under Sec 80C, TDS provision does not exist.

    Regarding RD scheme, I can safety say that no tax is deducted at source on maturity of the scheme. I too was subscriber of this scheme a few years back and got the full maturity amount what was mentioned in the pass book at the time of opening of the account.

    I think it may be the Govt policy to promote small saving schemes administered by the post offices and IT Deptt might have given relaxation to Sec 194A, as both small saving schemes and IT Deptt comes under the Ministry of Finance.
     
    Last edited: Aug 4, 2016
    Karan Batra and ZED like this.
  6. ZED

    ZED Well-Known Member

    Thanks a lot Sir, your this post is very valuable and I am going to save it. Can't read completely due to eye trouble but I got the glimpse.
    Thanks a gazillion.
     
    V K Khanna likes this.
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