TDS on FD: Government Clarifies New Income-tax Act 2025 Rules, Big Relief for Small Investors

• Government clarifies new Income-tax Act 2025 rules regarding TDS on FD interest, easing confusion.
• Section 194A of the Income-tax Act, 1961, still governs TDS deduction on FD interest.
• No change in the rule: TDS not deducted if interest is below the prescribed limit (₹50,000 or ₹1,00,000).
• All banking institutions under the Banking Regulation Act, 1949, remain within the scope of "banking company."
• Small investors receive significant relief as the clarification avoids unnecessary tax deductions and refund processes.