What is a potential consequence of premature closure of a Fixed Deposit? Option: Tax benefits for senior citizens, Automatic renewal of the FD at a higher interest rate, A penalty fee and potential deduction of earned interest, Increased interest earnings

<< Back

Hi

Show Ans

i

What is a potential consequence of premature closure of a Fixed Deposit?

Tax benefits for senior citizens

Automatic renewal of the FD at a higher interest rate

A penalty fee and potential deduction of earned interest

Increased interest earnings

<< Back

Hi

Show Ans

i

What is the significance of Deposit Insurance for Fixed Deposit holders?

It guarantees high returns on FD investments

It protects against losses due to market volatility

It provides coverage up to a certain limit in case of bank failures

It ensures tax exemption on interest earned from FDs

<< Back

Hi

Show Ans

i

How does the taxation policy apply to interest earned on Fixed Deposits for individuals below 60 years of age in India?

Interest income is entirely tax-free

Tax liability is determined by the individual's investment portfolio

TDS (Tax Deducted at Source) may apply if interest exceeds a certain limit

Interest is taxed at a flat rate regardless of the amount

<< Back

Hi

Show Ans

i

How does the interest payout mechanism work for Fixed Deposits?

Interest is directly reinvested into the stock market

Interest is determined by market fluctuations

Interest is only paid at maturity

Interest can be received on a fixed schedule (monthly, quarterly, annually)

<< Back

Hi

Show Ans

i

What is the penalty for withdrawing from the Post Office Monthly Income Scheme (POMIS) before the completion of one year?

"Varies based on the amount withdrawn"

"Zero benefits"

"2% of the deposit"

"1% of the deposit"

<< Back

Hi

Show Ans

i

What is the key feature of tax-saving Fixed Deposits in India?

They have a shorter lock-in period compared to regular FDs

They offer higher interest rates than regular FDs

They fall under Section 80C of the Income Tax Act, offering potential deductions

They are exempt from all tax liabilities