Today we are going to discuss everything about FD - TDR in Indian Banking System. You will get to know TDR Scheme in detail. You can opt this option while fixing amount as FD in your bank. So let's start -
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| about fixed deposit TDR |
What is TDR? - The full form of TDR in Banking is Term Deposit Receipt. TDR is a type of Fixed Deposit where you can choose receiving the interest on the basis of Monthly or Quarterly. This scheme is popularly known as Interest Payout option. This scheme is suitable for those people who want a regular income.
Working Concept of TDR? - You have to Deposit a lump sum amount for a specific (better if long duration) time. Now you have an option to choose of getting interest on Monthly or Quarterly basis. You will be getting interest for your deposit as long as the tenure ends up that you given while opening FD-TDR. Now at the end of the tenure, you will get full amount that you fixed.
Features of TDR? - It is safe investment option and you will get guaranteed fixed returns. You can get monthly or quarterly regular income. Generally senior citizen get extra income from FD-TDR.
Income Tax Benefits? - There are two systems in TDR. One is Old Tax System and another is New Tax System. Effective from 1st April, 2020 the income tax benefits depend on the tax system in which we fall.
- Old Tax System - Deposited amount up to 1.5 Lakh under 5 years Tax Saving FD will qualify for tax deduction under 80 C section of Income Tax Act. No Tax deduction benefits for deposit other than 5 years Tax Saving FD. Interest received is taxable. You need to declare the interest income under "Income from other sources" during tax returns and pay the income tax as per your income tax slab.
- New Tax System - No income tax benefits. the deposit amount won't get any deduction benefits under section 80 c of income tax act.
Eligibility of opening an account? Account can be opened individually of Joint account of 2 or more people.
Process of opening an account under TDR? Account can be opened by cash or Cheque. You can also use Saving Account Funds to open this account. Nowadays online facility is also available therefore you don't need to visit a branch of bank to open this account. You get this feature in various applications of banks.
What is deposit limit? Minimum limit to open this account is 1,000/- rupees only. There is no maximum limit for opening FD under TDR.
Term Duration for FD TDR? You can get option from 7 days to 10 years in most of banks but some banks also offer up to 20 years.
What interest rates we get? Generally you get interest rates like Fixed Deposits but it various from Bank to Bank and with time.
Do we get compound interest? No, you will get simple interest.
Auto-Renewal Facility? You can choose auto renewal while opening this account. If you choose this option, after ending the tenure your TDR FD will automatically be renewed.
Premature Closer? You can close your account before maturing but there is a fine on premature closer of 1% and this changes bank to bank and time to time.
Loan Facility? It is available up to 90% of the amount you deposited.
Account Conversions? You will be able to convert your TDR (regular interest payout) account to STDR (cumulative interest payout) account and vice versa.
Transfer of Accounts? You can transfer TDR accounts from one branch to another branch without paying any fee.
Nomination Facility? You get nomination facility in TDR FD. You have to give nominee name before opening the account or after opening the account, but before maturity of the account.
Can Non Resident Indians open this account? No, this is only for Indian individuals. NRI can opt for NRI fixed deposit option but that is something different from Fixed Deposit TDR.
Now we hope that all your queries have been solved. If you have any other query just ask us.
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