INSUBCONTINENT EXCLUSIVE:
SBI reinvestment plan is subject to a tax deducted at source (TDS).State Bank of India or SBI offers a variety of savings instruments from
fixed deposit (FD) accounts, to mutual funds (MFs)
One such product offered by SBI is the reinvestment plan, which works like a fixed deposit (FD)
However, in case of a reinvestment plan, interest is given at the time of maturity
In this scheme, the interest earned on a deposit is added into the principal and reinvested, according to SBI's website, sbi.co.in
On the other hand, in case of a fixed deposit (FD), Interest is paid out at a regular frequency during the period of deposit
( Looking To Invest In SBI Deposit Schemes These Are The Returns You Get)SBI FD Investment LimitsCustomers willing to invest in reinvestment
scheme are required to pay a minimum of Rs 1,000
Deposit Account)SBI FD TenureThe minimum tenure for SBI's reinvestment plan is six months and the maximum is 10 years.SBI FD Interest
RatesThe interest rate is same as applicable to SBI's fixed deposits with quarterly compounding
The following FD interest rates are applicable on deposits below Rs 2 crore, according to the bank's website:PeriodGeneral public (%
p.a.)Senior citizens (% p.a.)180 days to 210 days6.356.85211 days to less than 1 year6.46.91 year to less than 2 year77.52 years to less
than 3 years6.757.253 years to less than 5 years6.77.25 years and up to 10 years6.67.1(As mentioned on SBI's website)SBI FD Tax Deducted
At SourceSBI reinvestment plan is subject to a tax deducted at source (TDS)
TDS is deducted at the prevalent income tax rate if form 15G/15H not submitted.SBI FD Premature Withdrawal RuleThe facility of premature
For fixed deposit (FD) up to Rs 5 lakh, the penalty for premature withdrawal is 0.50 per cent
The interest is 0.50 per cent or 1 per cent below the interest rate applicable at the time of deposits for the period deposit remained with
the bank or 0.50 per cent or 1 per cent below the contracted rate, whichever is lower
However, no interest is paid on deposits which remain for a period of less than seven days, according to SBI.
