Fixed deposits are one of the most preferred choices for investors looking for low-risk investment options. Along with scaling significantly low on risk-factor, fixed deposits also let investors avail deductions under section 80C of the Income Tax Act, 1961.
As per this section, resident individuals or Hindu Undivided Families (HUFs) who have invested in a tax–saving FD, are eligible to claim deduction up to Rs. 1.5 lakh in a financial year. The said deduction of 80C can be claimed in the financial year in which investment is made.