INTEREST ON SAVINGS BANK/OTHER

[janakiram g]

Sir/Madam

Kindly clarify me the following

1. Exemption limit for Interest on Savings bank a/c/ Fixed Deposit

2. I am working for Insurance Co. We need to settle Motor Third Party Claims which includes Interest Component also as a part of total Claim settlement. If interest component exceeds ₹ 50,000/-, we deduct tax on interest amount. It is mandatory that cheques should be issued in favour Principal Judge. But claimant/s may be different. E-filing of TDS return will be done in the name of Principal Judge and form 16A generated in the name of Principal Judge When court releases payment to Claimant, he may be interested in claiming TDS amount deducted on interest. In such a case, whether it is in order to issue Form 16A prepared in the name of Claimant manually.

AI Summary

Clarification on interest exemption limits under Section 80TTA and handling TDS credits for motor third-party claim settlements. A participant inquired about the exemption limits for interest on savings accounts and fixed deposits, and the process for handling tax deductions on interest components in motor third-party claim settlements. Specifically, they asked about issuing Form 16A in the claimant's name when tax is deducted in the name of the Principal Judge. The response clarified that under section 80TTA, there is an exemption of up to 10,000 on savings account interest. It also noted that manual TDS credits are not valid unless reflected on the Traces system, making manually prepared Form 16A ineffective.