How to avoid paying taxes on interest income

Do you wonder why interest earned from your FDs or interest bearing securities like bonds gets reduced due to tax deducted at source? Does it irritate you that tax has been charged even though you aren’t eligible to pay taxes?

Here, we tell you about why TDS applied and ways to avoid this tax deduction if you meet certain criteria.

Why should I know this?

If you are like most Indians, chances are the bulk of your liquid savings are in a bank account or in an FD. Some of us are invested in bonds. While these fixed income instruments are good for guaranteed returns, they are relatively tax inefficient instruments because you end up paying taxes on the interest income that you earn.

This tax is usually deducted at source, and there might be a situation where tax is being deducted even though you are not eligible for paying taxes. This could result in a cash flow problem because your tax outflow is today, but your refund might take many months to arrive.
How much is the TDS on interest from deposits and securities?

Fortune magazine recently did a survey to find out the world's most admired companies.

Fortune magazine recently did a survey to find out the world's most admired companies. To compile the list of 50 most admired companies overall, the US-centric survey asked business people to vote for companies that they admired most. While Apple topped the list, carmaker Volkswagen occupied the 50th position. Sadly, no Indian brand could make it to the top 50.

Wind, rain, sea pound eastern India as Cyclone Phailin nears

BHUBANESWAR: Strong winds and heavy rains pounded India's eastern coastline on Saturday, as hundreds of thousands of people took shelter from a massive, powerful cyclone expected to reach land in a few hours. The skies were dark - almost black - at midmorning in Bhubaneswar, the capital of Odisha and about 60 miles (about 100 kilometres) from the coast. Roaring winds made palm trees sway wildly, and to the south, seawater was pushing inland. By Friday evening, some six lakh people had been moved to higher ground or shelters in Odisha, which is expected to bear the brunt of the cyclone, said Surya Narayan Patro, the state's top disaster management official. About 12 hours before Cyclone Phailin's landfall, meteorologists held out hope that the storm might hit while in a temporary weakened state, but no matter what it will be large and deadly. Ryan Maue, a meteorologist at Weather Bell, a private US weather firm, said even in the best-case scenario there will be a st...

Value art

"Tomorrow's Blue-Chip" art exhibition, curated by Sharan Appa Rao of the Appa Rao Galleries, will be held at The Park Hotel, Chennai, in collaboration with ABN AMRO on December 20. The title leaves little doubt in one's mind about aesthetic production becoming integrated into commodity production. The demand for newness and freshness places a premium on the types and varieties of art products, conditioning the function and position of aesthetics, innovation and experimentation. And these economic and aesthetic structures are validated by institutional support available for newer art forms from grants and museums to art galleries, corporate houses, art journals and astute dealers. Says Sharon, commenting on the growth of art market since post-independence, "In the early 1960s and the 1970s, art collecting was limited to foreigners, ICS officers, diplomats and academicians. Husain, Gaitonde, Krishen Khanna, Tyeb Mehta, Souza and Hebbar sold their wor...

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