Invest in Tax Saving Deposit with Banks

With the Tax season on the salaried class is looking for avenues to save tax. The banks have Tax Saving Deposits which help them in saving the tax. The Amount invested in such deposit gets Tax Benefit under Section 80CCC of Income Tax subject to overall limit of Rs.1 lakh. You can opt for Interest payment at periodical interval or opt for cumulative interest to be paid at the time of maturity. Such deposit will have fixed maturity of 5 years. You cannot withdraw it prematurely and you cannot avail any loan by pledging the deposit. The interest earned is taxable.