Can the interest from several savings accounts be claimed under Section 80TTA?

Yes, the interest from several eligible savings accounts can be added together when working out the deduction. But the total deduction must not go above ₹10,000.

Does Section 80TTA have an effect on the amount of tax payable or on the taxable income?

The deduction lowers the income upon which tax is calculated; it does not result in a direct reduction of ₹10,000 of the final tax payable.

Can a senior citizen avail both Section 80TTA and Section 80TTB?

No, senior citizens are not entitled to the deduction under Section 80TTA. Instead, they may look at the deduction provided for under Section 80TTB.

Is the interest earned from a savings account taxable if it is less than ₹10,000?

Interest earned from a savings account is still considered to be income and must be reported. However, if the taxpayer is entitled to Section 80TTA, the qualifying interest may be claimed as a deduction, provided that the amount does not exceed ₹10,000.

Is it possible to claim Section 80TTA on the interest from a fixed deposit?

The interest from fixed deposits is not allowable as a deduction under Section 80TTA since that provision relates to deposits in eligible savings accounts, not to time deposits.

Does the interest from a current account fall within the scope of Section 80TTA?

Current account interest does not count. The rule applies to interest from savings accounts that qualify.

What will occur if the interest on a savings account is more than ₹10,000?

As a deduction under Section 80TTA only ₹10,000 can be claimed and any amount in excess of ₹10,000 is not eligible for this deduction and is therefore subject to tax as per the applicable rates.

Can an HUF claim the Section 80TTA deduction?

Yes. Section 80TTA covers Hindu Undivided Families, subject to the conditions prescribed under the Income-tax Act.

Section 80TTA of Income Tax Act: Deduction Limit

Q: Can you claim Section 80TTA under the new tax regime?

The deduction can be availed when opting for the old tax regime. The Income Tax Department's ITR validation rules expressly limit the claim to those taxpayers who choose the old tax regime.

Income Tax Section 80TTA: Deduction on Savings Account Interest

6 min read•Updated on 21st Oct, 2026•by Team Angel One

If you earn interest on the money kept in your savings account, that interest is generally taxable. Section 80TTA of the Income Tax Act provides a deduction on eligible savings account interest, subject to a maximum limit of ₹10,000. The deduction is available to individuals and Hindu Undivided Families (HUFs), but senior citizens fall under Section 80TTB instead.

Here is how the deduction applies to interest from eligible bank, post office, and cooperative society savings accounts and is available under the old tax regime.

Key Takeaways

Section 80TTA allows a maximum deduction of ₹10,000 on eligible savings account interest.
Interest from savings accounts with banks, post offices, and eligible cooperative societies can qualify.
Interest from fixed deposits, recurring deposits, bonds, and current accounts does not qualify under Section 80TTA.
The deduction is available under the old tax regime and cannot be claimed under the new tax regime.
Senior citizens cannot claim Section 80TTA and may instead qualify for the higher deduction available under Section 80TTB.

What is Section 80TTA of the Income Tax Act?

Section 80TTA provides a deduction on interest earned from eligible savings accounts. The deduction can reduce taxable income by up to ₹10,000. The provision covers interest earned on savings accounts held with:

Banks
Post offices
Cooperative societies carrying on banking business

The deduction is available on the interest earned during the financial year. If the eligible interest is below ₹10,000, the actual interest amount can be claimed. If it is more than ₹10,000, the deduction is restricted to ₹10,000.

The deduction is not an exemption from earning interest. The interest still needs to be included while calculating income. Section 80TTA provides a deduction from eligible income when the applicable conditions are met.

Who can Claim Section 80TTA Deduction?

Section 80TTA is available to an individual taxpayer or a Hindu Undivided Family (HUF), subject to the conditions under the section.

Senior citizens cannot claim this deduction.

They are covered separately under Section 80TTB, which provides a deduction of up to ₹50,000 on eligible interest from deposits with banks, cooperative banks, and post offices.

The Income Tax Department also specifies that Section 80TTA is for non-senior-citizen taxpayers and limits the deduction to eligible savings account interest.

Can NRIs Claim Section 80TTA?

Non-Resident Indians (NRIs) can claim Section 80TTA deduction only on Non-Resident Ordinary (NRO) savings accounts.

Note: Interest earned on Non-Resident External (NRE) accounts is already completely tax-free under Section 10(4)(ii) of the Income Tax Act, so NRE interest does not need to be claimed under Section 80TTA.

Which Interest Income Qualifies for Section 80TTA?

Not every type of interest income qualifies. Section 80TTA specifically deals with interest from savings accounts. Eligible interest can include:

Interest from a savings account with a bank
Interest from a savings account with an eligible cooperative society
Interest from a post office savings account

The Income Tax Act specifically excludes time deposits from the provision. A time deposit refers to a deposit that becomes repayable after a fixed period.

Eligibility vs Ineligible Under Section 80TTA

Type of interest / Account	Eligible under Section 80TTA?	Reason / Classification
Savings account interest (Banks, Post Offices, Cooperative Societies)	Yes	Directly qualifies as eligible savings bank interest under the section.
Fixed deposit (FD) interest	No	Classified as a time deposit (repayable after a fixed period), which is explicitly excluded by the Income Tax Act.
Recurring deposit (RD) interest	No	Also classified as a time deposit locking funds for a tenure, making it ineligible.
Current account interest	No	Current accounts are meant for business transactions and do not qualify under personal savings provisions.
Bond & Debenture interest	No	These are fixed-income securities and debt instruments, not savings bank deposits.

What is the Maximum Deduction Under Section 80TTA?

The maximum deduction under Section 80TTA is ₹10,000 in a financial year.

The ₹10,000 limit applies to the combined eligible savings account interest. It is not a separate ₹10,000 limit for every savings account.

For example, suppose a taxpayer earns:

₹4,000 from savings account A

₹3,000 from savings account B

₹2,500 from savings account C

Total eligible interest = ₹9,500

Since the total is below ₹10,000, the taxpayer can claim the full ₹9,500 as a deduction.

Now consider another taxpayer who earns:

₹5,000 from savings account A

₹4,000 from savings account B

₹3,000 from savings account C

Total eligible interest = ₹12,000

The deduction will be restricted to ₹10,000.

How is the Section 80TTA Deduction Calculated?

Formula:

Section 80TTA deduction = Lower of eligible savings account interest or ₹10,000

For example:

Eligible savings account interest = ₹13,500

Maximum deduction = ₹10,000

Therefore:

Section 80TTA deduction = ₹10,000

The remaining ₹3,500 is not eligible for deduction under Section 80TTA.

If the eligible interest is ₹7,500:

Section 80TTA deduction = ₹7,500

The deduction cannot exceed the actual eligible interest earned.

Can You Claim Section 80TTA Under the new tax Regime?

No. Section 80TTA is available under the old tax regime.

The Income Tax Department's ITR validation rules specify that Section 80TTA can be claimed when the old tax regime is selected. The deduction is restricted to savings account interest reported under income from other sources.

This makes the choice of tax regime important for taxpayers who want to use Section 80TTA. A taxpayer opting for the new tax regime cannot separately claim this deduction.

How do You Claim Section 80TTA in Your ITR?

You do not need to submit a separate application to claim the deduction. The amount needs to be reported correctly while filing the income tax return.

Step 1: Calculate Your Savings Account Interest

Check the interest credited to all eligible savings accounts during the financial year.

Include only interest that qualifies under Section 80TTA.

Step 2: Exclude Non-Eligible Interest

Separate interest earned from fixed deposits, recurring deposits, bonds, debentures and other investments that do not qualify under this section.

Step 3: Apply the ₹10,000 Limit

Add the eligible savings account interest from all qualifying accounts. Claim the lower of:

Actual eligible savings account interest

₹10,000

Step 4: Select the Applicable tax Regime

Section 80TTA can be claimed only if you are eligible to file under and select the old tax regime. The deduction is not available under the new tax regime.

Step 5: Report the Deduction in Your ITR

Enter the eligible deduction in the applicable section of your income tax return and complete the remaining details before filing.

What is the Difference Between Section 80TTA and Section 80TTB?

Both Section 80TTA and Section 80TTB allow for deductions relating to interest income, but they apply to different kinds of taxpayers and relate to different types of deposits.

Basis	Section 80TTA	Section 80TTB
Eligible taxpayers	Individuals and HUFs, excluding those covered by 80TTB	Resident senior citizens
Maximum deduction	₹10,000	₹50,000
Savings account interest	Eligible	Eligible
Fixed deposit interest	Not eligible	Eligible
Recurring deposit interest	Not eligible	Eligible
Tax regime	Old tax regime	Old tax regime

Under Section 80TTB, resident senior citizens are entitled to a deduction of up to ₹50,000 on interest from eligible deposits. This applies to the interest earned from savings deposits and fixed deposits with banks, cooperative banks, and post offices.

What do You Need to Check Before Claiming Section 80TTA?

Senior citizens should look at Section 80TTB rather than Section 80TTA.

Make sure you check the type of account; only interest from eligible savings accounts counts.

The interest limit of ₹10,000 applies to the total of the eligible interest.

You should check the tax regime since Section 80TTA is only available under the old tax regime.

Statements from the bank and the post office can be used to verify the interest that is reported in the ITR.

Interest from a fixed deposit may not be claimed under Section 80TTA.

Conclusion

A limited and useful tax deduction is available under section 80TTA for the interest earned in eligible savings accounts. The highest amount that can be deducted is ₹10,000, and it is applicable to the interest earned from qualifying savings accounts kept with banks, post offices, and eligible cooperative societies.

The important thing to note is that all kinds of interest do not count. Interest from fixed deposits, recurring deposits and bonds is not covered by Section 80TTA. Instead, senior citizens should consider Section 80TTB. Before you make a claim for the deduction, verify the eligible interest, apply the ₹10,000 limit and make sure that the old tax regime is applicable to the return.