Jayant Sinha, Minister of State for Finance has clarified that there will be no TDS on interest earned through recurring deposits or RDs of post offices.
Earlier, Union Budget 2015 had proposed to put RDs under the ambit of TDS. A TDS of 10% has been proposed to be deducted from interest earned of over Rs.10,000 through RDs. However, in order to promote small savings, the government has kept post office RDs away from the ambit of TDS.
In response to the question asked in Lok Sabha, Jayant Sinha, Minister of State in Ministry of Finance said, “The Government proposes to promote the recurring deposits scheme. It takes various measures on continuous basis to promote and popularize all small savings scheme including post office recurring deposit scheme through electronic and print media as well as holding seminars, meetings and providing training to the various agencies involved in mobilizing deposits under these schemes.”
Meanwhile, bank RDs will attract TDS on interest earned of over Rs.10,000.
