Section 80 TTA

Section 80 TTA: An Overview

The interest received on your savings account with a bank, cooperative society, or post office is deductible up to ₹10,000 under Section 80TTA of the Income Tax Act of 1961. Under Section 80TTA, there is no deduction for FD or RD interest. All individuals and HUFs are eligible for this deduction, with the exception of super senior citizens (those who are 60 years of age or beyond), who are eligible for a different deduction under Section 80TTB.

The Finance Bill that year included the introduction of Section 80TTA, which became effective for the financial year 2012–13 and is still in effect today.

Maximum Deduction Allowed Under Sec 80TTA

The maximum deduction, as previously stated, is ₹ 10,000. The entire amount of interest income will be deductible if it is less than ₹10,000. The deduction is only allowed if the interest is less than or equal to ₹10,000.

Key Features of Section 80TTA

Here are a few key features of section 80TTA according to the year 2023-24 and remove the 3rd FAQ Is Sec 80TTA applicable for 2023-24?

• The annual tax exemption for interest income is only worth ₹ 10,000
• An individual or Hindu Undivided Family who holds a savings account is eligible for this
• Even though a person may have multiple savings accounts, the assessee is completely exempt if the total interest earned from all of them is less than ₹. 10,000
• If the total interest exceeds ₹10,000, only ₹10,000 should be claimed as a tax exemption
• The tax deduction provided by this section is in addition to the Section 80C deduction of ₹1.5 lakh.

The following are included under the scope of the savings account:

• Postal services
• Banks
• Cooperative societies.

Section 80 TTA Exemptions

The interest earned on FDs is not deductible under Section 80 TTA. As a result, it is taxed at the standard slab rates. Additionally, if the interest earned on an FD is greater than ₹10000, TDS provisions are also applicable.

The taxpayer can only claim the deduction under two circumstances: either they must be an individual or a member of a Hindu Undivided Family. Other entities now qualify for the deduction, including associations of people, bodies of people, and artificial juridical persons.

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