• Interest income from fixed deposits is fully taxable. It is added to your income and gets taxed at the slab rates applicable to your total income. This income is to be reported under the head 'Income from Other Sources' in your Income Tax Return.

• FD Issuers deduct tax at source at the time of crediting interest to your account.
• For Bank FDs, TDS is applicable on interest income if it exceeds ₹40,000 (₹50,000 for senior citizens) in a financial year.
• For NBFC FDs, TDS is applicable on interest income if it exceeds ₹5,000 in a financial year.

• However, there's a way to request a TDS waiver. Learn how to request a TDS waiver.

Let’s understand this by way of an example:

Age of Investor	FD details	Interest per financial year	TDS amount
<60	Invested - ₹1 lakhRate - 6%	₹1 lakh * 6% = ₹6,000 (<₹40K)	0
>60	Invested - ₹6 lakhsRate - 7%	₹6 lakhs * 7% = ₹42,000 (<₹50K)	0
<60	Invested - ₹6 lakhsRate - 7%	₹6 lakhs * 7% = ₹42,000 (>₹40K)	10% on ₹42,000 i.e. ₹4,200

Note: The calculation is for explanatory purposes, and actual results may vary due to differences in how banks calculate interest payments or their interest payout schedules.