My bank already deducts TDS on my FD interest. Do I still need to file an ITR and pay more tax?

Published 2 October 2026

Anmol from Guwahati

I earn about Rs 30L salary and have some FDs that give me around Rs 80k interest yearly.

The bank already cuts 10% TDS on this FD interest.

Since the tax is already deducted at source, can I just skip mentioning this in my ITR? I don't want to overcomplicate my filing.

Mohan Gupta Co-founder Foliyo AI, NISM Series X-A, X-B, XXI-A Certified LinkedIn

Banks only deduct a flat 10% TDS on your FD interest, which rarely covers your actual tax liability. Since your salary is Rs 30L, you fall into a much higher tax bracket, likely 30%. This means the 10% the bank took is only a fraction of what you actually owe the government.

You are legally required to file your ITR and pay the remaining 20% tax on that Rs 80k interest. A lot of salaried folks assume TDS means their tax duty is fully done. But TDS is just a mechanism for the government to track your income, not the final tax settlement.

If you ignore this, the tax department's systems will eventually catch the mismatch between your AIS and your filed return. Always declare every rupee of interest income, calculate your final slab rate, and pay the balance self-assessment tax before filing.

Disclaimer: All information shared above are strictly for educational and informational purposes only. It should not be construed as financial or investment advice.

Ask Mohan

Get your question answered by our advisor.

More from Mohan Gupta

Heer from Pune

I am 36 and feeling burnt out. Should I take a career break or push through?

I am 36yr old with about 14yr of work experience. I make a good salary but feel completely exhausted by the corporate grind. I am tempted to take a career break or step down to a l…

Sujith from Chandigarh

Retiring at 60 with a large NPS corpus: How do I avoid being trapped in a low-yield annuity?

I am 58 and approaching retirement with a sizable chunk of money in NPS. I am terrified of the rule that forces 20% of the corpus into an annuity. Annuities feel safe but they offe…

Yogitha from Mumbai

Rs 24L salary and investing Rs 20k monthly for 25yr: Should I stick to 100% debt EPF or shift to NPS?

I am 30 and currently earning a gross salary of Rs 24L. I plan to invest Rs 20k monthly specifically for my retirement over the next 25yr. Right now most of my forced savings go in…

Nimisha from Bengaluru

Losing corporate health cover at 60: How do I manage Rs 70k premiums without draining my retirement corpus?

I am 57 and stepping down from my corporate role in about 3yr. My biggest anxiety is losing my employer health insurance. Getting a comprehensive base policy at age 60 is quoting m…

Vikram from Surat

My late father left behind a Rs 20L personal loan but his total assets are only Rs 15L. Will the bank seize my personal savings?

My father suddenly passed away last month. While going through his finances, we discovered he had an outstanding unsecured personal loan of Rs 20L. His total estate (bank balance a…