Sec 80TTA introduced wef AY 2013-14 is a great relief for people who were earning small amount of interest from their SB A/cs and were under a dilema whether to include it in their returns.
Interest from Savings account (SB A/c) is taxable under Income from Other Sources, but TDS is not deductible on the same.
However, from 2012-13 i.e AY 2013-14 ,under Section 80TTA SB interest up to Rs 10,000 in one financial year is exempt from tax.
This Section is applicable only to Individual and HUF. Savings account can be opened with Banks, Post office or a society. It has to be noted that FD Interest is not covered under this section.
This tax deduction is over and above Rs 1 lac deduction under Sec 80C.
Rs 10,000 is the total maximum deduction for all the saving bank accounts taken combinedly.