Have a fixed deposit? Alert! You may lose money if you did not provide this document

Be it a salaried employee or retired pensioner, everyone loves to see his/her wealth grow. The market is flooded with a lot of investment instruments including recurring deposits, mutual funds, equity, PPF and fixed deposits among others. While you can choose any option available in the market for investment, Fixed Deposit comes across as one of the safest options offering a healthy rate of return. However, you need to have necessary documents like ID and address proof as well as PAN card for opening the Fixed Deposit account.  

PAN is nowadays one such document in demand for almost all financial transactions. While you may get a little annoyed about producing it time and again, you should not forget that it also helps you save your hard earned money.  Income Tax Department has made it compulsory for IT return processing. Also, if you have opened a fixed deposit account with any bank, you may save on taxes if you have your PAN card among the documents produced for opening the FD.  If you have not provided your PAN card, you will have to pay taxes on your FD income as well. Check out the implications of booking an FD without PAN:

1. TDS will be recovered at 20%(as against 10%)

2. NO TDS credit from the Income Tax department

3. NO TDS certificate will be issued 

4. Form 15G/H and other exemption certificates will be invalid and penal TDS will apply

You should also know the new policy with regards to PAN to book fixed deposit with your bank (in this case HDFC Bank):

1. Where the total value of Fixed deposit per customer id <= 50,000 (including the new FD being booked) No PAN & no form 60 is required

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2. Where the total value of fixed deposit per customer is > 50,000 (including the new FD being booked) PAN is required mandatorily.