Nominee vs Legal Heir: Key differences & how form 15G can help you save big with a non-working family member

Discover how to maximise your Fixed Deposit benefits while minimising tax liabilities. Learn about using your spouse's name for FDs and the importance of Forms 15G and 15H.

ZeeBiz WebTeam | Oct 08, 2024, 04:29 PM IST

Fixed Deposits (FDs) remain a popular investment option for guaranteed returns, offering stability amidst diverse financial choices. Experts recommend FDs for portfolio diversification, but it’s essential to understand the tax implications, particularly for tenures under five years. By opening an FD in your spouse’s name, you can significantly reduce your Tax Deducted at Source (TDS) liability. This guide explains how to make the most of FDs while minimizing your tax burden.

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Trust in Fixed Deposits

Trust in Fixed Deposits

Fixed Deposit (FD) remains a trusted investment option for investors, despite various alternatives available.

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Guaranteed Returns

Guaranteed Returns

FD provides guaranteed returns, making it a secure choice in any investment portfolio.

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Flexible Tenures

Flexible Tenures

Investors can choose from various FD tenures, catering to different financial goals and needs.

 

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Form 15G for Tax Exemption

Form 15G for Tax Exemption

Your spouse must fill out Form 15G if her annual income is below the taxable limit to prevent TDS deduction.

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Using Spouse's Name for Tax Benefits

Using Spouse's Name for Tax Benefits

If your income falls within the tax bracket, consider opening an FD in your spouse’s name to avoid TDS.

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Legal Heir Eligibility

Legal Heir Eligibility

Common legal heirs include a spouse, children, and parents, based on inheritance laws.

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Nominee Is Not a Legal Heir

Nominee Is Not a Legal Heir

The nominee does not automatically inherit the assets and is not necessarily a legal heir.

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Distribution Without a Will

Distribution Without a Will

In the absence of a will, assets are distributed according to succession laws, favoring legal heirs.

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Legal Heir Rights

Legal Heir Rights

Legal heirs have the legal right to claim and inherit the deceased’s assets, overriding the nominee’s role.

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Nominee vs. Legal Heir in Practice

Nominee vs. Legal Heir in Practice

While the nominee manages the assets, only the legal heirs have the right to inheritance, making their role crucial in asset distribution.

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