TDS on SBI FD - TDS Rates and Rules in 2026

The bank deducts TDS (Tax deducted at source) before your interest is added to your account, especially when your interest income crosses a specific limit. This article informs you of all you need to know about the SBI FD TDS rate and how you can legally avoid or manage these deductions.

What is TDS on FD SBI?

TDS is an abbreviation that represents tax deducted at source. This concept means that SBI deducts a small amount of the interest you earn on your fixed deposit (FD) as tax before paying the rest to you. The process is done to ensure tax compliance and to prevent tax evasion.

SBI will deduct TDS if the total interest earned across all your deposits reaches ₹50,000 for regular citizens. However, in a major relief for retirees, the threshold for senior citizens has been increased to ₹1,00,000. These deductions are calculated based on the prevailing SBI FD interest rates and are deposited with the Income Tax Department under your PAN. To avoid this deduction, eligible investors whose total income falls below the taxable limit can submit Form 15G or Form 15H at the start of the year.

TDS Rules on Fixed Deposits (FDs)

As per the Income Tax Act, 1961, these are the basic rules for Tax Deducted at Source (TDS) on FD interest:

• The bank or NBFC deducts TDS directly before giving you the interest.
• TDS is applied when the interest is added to your account or at the time of maturity, whichever comes first.

You also get a TDS certificate (Form 16A) from the bank or NBFC. This shows how much tax was deducted from the interest earned on your FD.

How to Avoid TDS on SBI FDs

If your total income is below the taxable limit, you can stop SBI from deducting TDS by submitting a form. The two most common forms used are:

1. Form 15G:

   Form 15G is for people below 60 years

2. Form 15H:

   Form 15H for senior citizens who are 60 years and above

   You need to submit these forms at the beginning of every financial year. You can do it online using SBI internet banking, the Yono app, or by visiting your local SBI branch.

Only use these forms if your total income is below the taxable limit. If you give false information to avoid TDS on FD, SBI will lead to penalties. Use these forms only if you're genuinely eligible.

How to Check and Claim TDS

If the bank has already deducted TDS on FD SBI, you can check it in two ways:

1. Bank statement or a Passbook:

   look for the TDS entry next to your FD interest, which is usually marked clearly

2. Form 26AS:

   Form 26AS is a tax form that can be downloaded from the income tax website. It shows all TDS deductions made in your name.

If your income is not taxable, you can get the deducted TDS back when you file your income tax return (ITR), and the government will refund the extra tax to your bank account.

Make sure your PAN is always linked to your bank account to avoid higher taxes and deductions and to track your interest income regularly.

Conclusion

Knowing how TDS on SBI FD works can save you from losing money to unexpected and unknown tax deductions. The SBI FD TDS rate is 10% with PAN and 20% without PAN. By submitting Form 15G or 15H, you can avoid this deduction if your income is not taxable. Also, tracking your interest and TDS details makes it easier to claim refunds and file your tax return correctly. You can always plan, so that you can keep your FD interest rates safe, tax-efficient and on-going.