Corp Bank's new tax saving scheme

Corporation Bank launched a new tax saving term deposit scheme "" Corp Tax Saver "" here on Tuesday. The scheme provides dual benefits of high returns and tax exemption under Section 80 (C) of the Income Tax Act 1961.

CMD B Sambamurthy, who launched the scheme, said the bank had set an ambitious target of mobilising one lakh accounts under the scheme during the present year.

The period of deposits is fixed at five years with a minimum deposit amount of Rs 100 and a maximum of Rs 1 lakh. Quoting of PAN is a must for opening an account under this scheme.

Nomination facility is available to the depositor under this scheme but no premature closure is permitted before the expiry of five years from the date of its receipt nor can any loan can be granted against the deposit or it be used as a collateral security.

Tax shall be deducted at source on the amount of interest paid as per the Income Tax Act.

The product has two options "" Tax Saving Fixed Deposit (TSFD), which offers simple interest and Tax Saving Kshemanidhi Cash Certificate (TSKCC) offering compound interest under reinvestment plan.

TSFD enables the depositors to opt for monthly, quarterly, half yearly or early interest payment to be reinvested.

The deposit offers an attractive rate of interest of eight per cent with annual yield of 9.72 per cent. Senior citizens will get 8.75 per cent and the yield is as high as 10.83 per cent under the reinvestment plan.