Deduction for Interest on Deposits in Savings Account [Section 80TTA]
• Section 80TTA provides deduction to an individual or Hindu Undivided Family (HUF) from interest income earned on deposits in a savings bank account (excluding time deposits) held with:
Banking companies or institutions;
Co-operative societies engaged in banking business (including land mortgage or land development banks);
Post offices.
• Senior citizens must claim deduction for interest under Section 80TTB, not Section 80TTA.
• Partners or members cannot claim deduction on interest income from savings accounts held by the firm/AOP/BOI.
• Deduction is allowed equal to the interest credited or Rs. 10,000, whichever is lower.