Section 80TTA vs 80TTB 2026: Savings & FD Interest Deduction Explained

By Nitish Bharadwaj · Published Jul 16, 2026 · 5 min

Section 80TTA and Section 80TTB let old-regime taxpayers deduct interest earned on bank, post office, and cooperative society deposits, but the two sections aren't interchangeable. 80TTA caps non-senior individuals and HUFs at ₹10,000, and only savings account interest counts — FD and RD interest is fully taxable. 80TTB raises the cap to ₹50,000 for resident senior citizens and extends it to FD and RD interest as well, but seniors must pick one section, not both. Neither survives under the new tax regime. This guide covers eligibility, what counts, and where FD-heavy savers lose the deduction without realising it.

Two sections, one easily confused pair of numbers, and a mix-up that costs FD-heavy savers real money: Section 80TTA and Section 80TTB both deduct interest income, but they don't cover the same interest. A non-senior citizen assuming their FD interest is shielded under 80TTA the way their savings account interest is will be wrong at return-filing time — and a senior citizen who forgets to switch to 80TTB loses ₹40,000 of deduction they were entitled to.

Section 80TTA — Savings Account Interest Only, ₹10,000 Cap

Section 80TTA applies to individuals below 60 and to Hindu Undivided Families, and it deducts up to ₹10,000 a year from interest earned on savings accounts — held with banks, cooperative societies, or the post office. If you hold savings accounts across multiple banks, the ₹10,000 limit applies to your combined interest across all of them, not ₹10,000 per account. Critically, 80TTA does not extend to fixed deposit, recurring deposit, or any other time-deposit interest — only the savings account balance qualifies. If a post office savings account is part of that mix, there's a second, separate exemption worth knowing — see our Post Office Savings Account guide for how Section 10(15)(i) stacks on top of this deduction, and even survives the new tax regime.

Section 80TTB — Senior Citizens, ₹50,000 Cap, Covers FDs Too

Section 80TTB applies only to resident individuals aged 60 and above, and it's meaningfully broader: the ₹50,000 annual cap covers interest from savings accounts, fixed deposits, and recurring deposits, held with banks, cooperative societies, or the post office. For a senior citizen with a savings account plus a couple of FDs, this single deduction can shelter the entire deposit-interest income of many retirees who rely on FD interest as a primary income source.

Neither Deduction Survives the New Tax Regime

Both Section 80TTA and Section 80TTB are old-regime-only, exactly like Section 80C, 80D, and Section 80G. Under Section 115BAC — the new regime, now the default unless you actively opt out — every rupee of savings account, FD, and RD interest is taxed at your slab rate with no deduction at all, for both non-seniors and senior citizens. If your deposit interest is a meaningful part of your income, this is one more factor to weigh into the old-vs-new regime decision alongside HRA, 80C, and home loan interest — though for retirees specifically, our old vs new tax regime comparison for senior citizens shows the ₹50,000 80TTB cap is rarely enough on its own to make the old regime win once total interest income crosses a few lakh.

How This Interacts With TDS on FD Interest

TDS on FD interest and the 80TTA/80TTB deduction are separate mechanisms that solve different problems. Banks deduct TDS on FD interest once it crosses ₹50,000 a year for non-seniors and ₹1 lakh for senior citizens per bank (thresholds raised by Budget 2025, effective April 1, 2025) — a withholding mechanism, not the actual tax liability. The 80TTA/80TTB deduction is what determines your final taxable interest income when you file. A senior citizen can have TDS deducted on FD interest during the year and still get up to ₹50,000 of that same interest deducted under 80TTB at filing time, potentially triggering a refund — our Section 194A TDS on FD interest guide covers the withholding side in full, including how to submit Form 15G/15H to avoid TDS deduction where your total income doesn't warrant it.

A Worked Example

A 65-year-old with ₹35,000 in savings account interest and ₹60,000 in FD interest earns ₹95,000 in total deposit interest for the year. Under the old regime with 80TTB, ₹50,000 of that is deducted, leaving only ₹45,000 taxable at slab rate. A 45-year-old in an identical situation gets no benefit from 80TTA on the ₹60,000 FD interest at all — only the ₹35,000 savings account portion is even eligible, capped further at ₹10,000 — leaving ₹85,000 taxable. The age difference alone changes the taxable interest by ₹40,000.

If you're building your full old-regime deduction stack, our guides to Section 80D health insurance premiums and Section 80C home loan and PPF deductions cover the other pieces senior citizens and salaried taxpayers commonly stack alongside 80TTA/80TTB.