Frequently Asked Questions

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When do I become liable for TDS?

You become liable for TDS* when the aggregate interest you earn for all deposits held in a particular customer ID is greater than Rs. 10,000/- in a financial year.

Disclaimers:
*Tax liability for TDS purpose is determined at branch level. Deposits held by minors are also subject to TDS. The credit for the TDS can be claimed by the person in whose hands the minor's income is included.

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When is TDS deducted?

TDS is deducted every time the Bank pays/re-invests interest during the financial year.

TDS is deducted every time the Bank pays/re-invests interest during the financial year. TDS is also deducted on unpaid interest accrued at the end of financial year viz. 31st March.

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Can TDS be recovered from principal of deposit in any case?

When interest amount is insufficient to recover TDS, the same is recovered from the principal of the deposit.

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Can the maturity amount of the deposit reduce due to TDS?

Yes, in case of reinvestment deposits, the interest reinvested is post TDS recovery.

Therefore, the maturity amount for re-investment deposits varies to the extent of tax and compounding effect on tax for the period subsequent of deduction till maturity.

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Does any change or enhancement in my deposit portfolio affect TDS liability?

Yes. If the change or enhancement in your deposit portfolio earns a cumulative interest** along with that of the earlier portfolio greater than Rs. 10,000/- you will be liable for TDS on your current portfolio.

Disclaimers:
**If interest on the current portfolio is not sufficient to cover TDS, it will be recovered from the principal.

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At what rate is TDS deducted?

W.E.F. Aug 09, applicable TDS rates are:

 

Tax Rate

Surcharge

Education Cess

TOTAL

Resident Individuals & HUF

10%   

Nil

Nil

10%

Corporate Entity

10%

Nil

Nil

10%

NRO

30%

Nil

3%

30.9%

Firms

10%

Nil

Nil

10%

 

Disclaimers:
As per section 206AA introduced by Finance (No. 2) Act, 2009 w.e.f. 01.04.2010, every person who receives income on which TDS is deductible shall furnish his PAN, failing which TDS shall be deducted at rate of 20% in case individuals and at the rate of 30% in case of non-individuals for Domestic deposits and 30.90% in case of NRO deposits.

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How and when can I apply for exemption on TDS?

When your total interest income for the year will not fall within overall taxable limits, you should inform the bank not to deduct TDS on deposits.

You can do this by submitting a form as per the provisions of the Income Tax Act. The forms required for different categories have been listed below:

Category of Account

Form Required

Individual

15H

Companies

15AA

Association of Companies

15AA

Trusts

15AA

 

Disclaimers:

  • You have to obtain 15AA Form from the Assessing Officer of Income Tax department.
  • Even if the customer submits the 15H/15AA Form, the tax which has already been deducted by way of TDS during the year prior to submission of 15H Form will not be refunded by the bank. However, Certificates will be issued to the customers which can be used while filing his/her tax return.
  • 15H/15AA Forms are valid only for the particular financial year in which they are issued.
  • A fresh Form 15G/H needs to be furnished for each deposit that is placed with the Bank within the first week of the financial year.

 

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When does the Bank issue a TDS Certificate?

Following are the information:

  •      For TDS deducted during a calendar quarter, the same will be issued in the next month of the respective quarter.
  •      The TDS Certificates that were sent till date via post can be downloaded online from the NSDL.
  •      TDS Certificate in Form 16A starting from financial year 2010-11.

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Can the account be opened in a joint account with a non-senior citizen?

Yes, provided the first account holder is a senior citizen.

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What documentation is required to open a senior citizen Fixed Deposit?

While opening the account, the customer needs to provide proof of age establishing that he/she is a Senior Citizen. To accomplish this, either of the following can be submitted:

 

  •      Secondary School Leaving Certificate
  •      LIC Policy
  •      Voters Identity Card
  •      Pension Payment Order
  •      Birth Certificate issued by the competent authority
  •      Passport
  •      Defense ID Card/Government ID Card (Provided they have the cardholder's photo, signature and date of birth)
  •      PSU Issued ID Cards
  •      Senior Citizen Cards issued by Indian Airlines/Indian Railways
  •      PAN Card

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Do I need to apply for a separate Customer ID to avail the senior citizen Fixed Deposits facility if I am an existing customer?

There is no need to create a separate Customer ID to avail of this product. For new Fixed Deposits, you only have to provide proof of age.

 In case proof of age is not submitted, the interest earned will be the same as for the Regular Fixed Deposit.

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Is Age Proof required for all the subsequent Deposits?

All subsequent Fixed Deposit applications need to be accompanied by proof of age.

 The only exception to this rule is where a customer already has a live senior citizen Fixed Deposit existing at the time of placing the next Fixed Deposit. The Fixed Deposit number needs to be mentioned on the Form. In such cases, it will be assumed that proof of age already exists with the Bank.

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Can I open a Fixed Deposit through NetBanking if my PAN details are not updated with the bank?

Through Net Banking, Fixed Deposit can be booked by any applicant subject to PAN is updated with the Bank for the Primary applicant in which the Fixed Deposit is getting booked.

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What are the implications of booking a Fixed Deposit without PAN?

In the absence of PAN, following are the implications for customers:

 

  •      TDS will be recovered at 20% (as against 10%)
  •      NO TDS credit from the Income Tax department
  •      NO TDS certificate will be issued (As per CBDT circular no: 03/11)
  •      Form 15G/H and other exemption certificates will be invalid and penal TDS will apply

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What is the NEW policy with regards to PAN to book Fixed Deposit with Kotak Mahindra Bank?

Following are the new policies:

  •      Where total Fixed Deposit value under per Customer ID per branch is <= Rs. 50,000/- (including the new Fixed Deposit being booked) ---- NO PAN & NO      FORM  -60.
  •      Where total Fixed Deposit value under per Customer ID per branch is > Rs. 50,000/- (including the new Fixed Deposit being booked) ---- PAN REQUIRED      MANDATORILY.

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