[carboy]

Originally Posted by sgiitk

sweep is a pain in the ar#$. When you sit down to calculate your income tax then you will know. You never know what is the interest, since an FD can be partly cashed, and you will find it difficult to figure out the interest (and hence the tax).

I have never calculated interest for tax purposes. The bank sends me the document which tells me how much interest they have paid me over the whole financial year - it's the sum of interest for savings account, FDs, and sweepin account. Each of my banks sends me this document. That is the net sum of interest on which I am liable for tax.

You can also do this. Phone up your bank and ask them to send this (mostly they send it on their own, but I lose it by the time tax filing season comes). Alternatively I walk into to any of their branches & ask them to give a printout of the net interest paid over the year. It usually takes 5 minutes.

Originally Posted by sgiitk

Also, I doubt whether the 10k exemption on tax free interest will apply to Sweep FDs.

Of course it is.

[sgiitk]

Originally Posted by carboy

I have never calculated interest for tax purposes. The bank sends me the document which tells me how much interest they have paid me over the whole financial year - it's the sum of interest for savings account, FDs, and sweepin account. Each of my banks sends me this document. That is the net sum of interest on which I am liable for tax.

You can also do this. Phone up your bank and ask them to send this (mostly they send it on their own, but I lose it by the time tax filing season comes). Alternatively I walk into to any of their branches & ask them to give a printout of the net interest paid over the year. It usually takes 5 minutes.

Of course it is.

Well your banks are better than most. I do get a statement from StanChart, but I have never got any statement from SBI. One of my colleague took out an FD with Union Bank, they deducted Tax but it did not even reflect on Form 26AS.

I will be very surprised that the Tax on Sweep FDs will fall inside the 10k exemption of 10k for savings interest. After all they are FDs.

[carboy]

Originally Posted by sgiitk

I will be very surprised that the Tax on Sweep FDs will fall inside the 10k exemption of 10k for savings interest. After all they are FDs.

Sorry - I meant to write "Of course it does not".

Anyway, assuming your bank pays 4% of savings account & 9% for the 1 year sweep in FD. And you are in the highest tax bracket, so your marginal rate is 30%.

So even if you paid tax on the Sweep In FD, your net interest would be more than 6%, so you will still come out ahead of savings bank interest.

[Raccoon]

Originally Posted by sgiitk

sweep is a pain in the ar#$. When you sit down to calculate your income tax then you will know. You never know what is the interest, since an FD can be partly cashed, and you will find it difficult to figure out the interest (and hence the tax). Also, I doubt whether the 10k exemption on tax free interest will apply to Sweep FDs. My son had sweep in his ICICI account and I had to ask him to deactivate it. When SBI converted my salary account to a corporate account they wanted some point for the sweep to operate. Since I did not want it and did not feel like getting into an argument I specified an amount of a crore for the sweep to trigger.

I had a similar thought myself - that it would be difficult to calculate and keep track of whether the bank had given me the right interest for any FD that is swept-in. Not sure how much one can trust the bank to do it honestly... Tax would come after that.

[faustus77]

Raccoon
Hi
Over a cerain period of time I maintained a balance of rs 100000 in my savings account.Due to that I became a classic customer.Not much advantage except you dont have to maintain 10000 as minimum balance.Also I got a multicity check(very common nowadays but rare at that time)and also anybody could deposit a cheque in any HDFC branch/atm anywhere in India.
You dont have to visit the branch just call them and the customer relation executive will answer everything.
Regards

[Raccoon]

^^^Oic! How long did you maintain 100k in your SB a/c? Would loose lot of interest! Now, even if you have more than that in their FDs they don't seem to give a damn, and still want you to maintain 10k in the SB a/c.

AFAIK, even in their normal/basic SB a/c anybody can deposit a cheque at any of their ATMs in India, and its free. Or am I wrong?

Call them!?!? Well, thats the problem right now! Yesterday, I made 3 attempts to call their Phonebanking and not once could I get thru to their rep.

As for the Phonebanker being able to answer everything, my optimisim suddenly nosedived in the evening today when I got a reply for my 3rd email. They have informed that they are "looking into" the matter and will take 5 working days to respond! Five full, long days to inform whats the trigger point for the Sweep-in to occur. Should I feel very optimistic?

[carboy]

Originally Posted by Raccoon

AFAIK, even in their normal/basic SB a/c anybody can deposit a cheque at any of their ATMs in India, and its free. Or am I wrong?

If you have a Bombay account & the cheque is not Payable at Par/Multicity, then if you send the cheque to someone in a different city and they deposit in their account, they will be charged a fee (for an out-of-city cheque clearing). This is because their bank has to send it to your banks branch in Bombay rather than your banks branch in their city.

OTOH, with a Payable at Par/Multicity Cheque, their bank can send it your banks branch in their city for clearing, so no fees for your cheque's recipient.

That's why most people/businesses will not accept an out of city cheque unless it's Payable at Par/Multicity.

[Raccoon]

^^^Yes, I'm aware of that. What I had in mind is - someone from some other city has to pay me some amount (or I need to pay someone in some other city). Then he can deposit a cheque (of some bank in his city) at any HDFC bank (or I deposit at any ATM of his bank, if I have to pay him) ATM in his city and it will be free. Personally, this is all that I require.

Last time someone had to pay me some amount he deposited the amount (cash) in some HDFC branch in his city and I got charged for it. They call it 3rd party cash deposit and its a nice way for them to milk you some more. Once they even had the cheek to charge me when I deposited cash myself. But I got it reversed. You gotta keep a hawk eye your transactions.

[gururaj r]

Originally Posted by Raccoon

^^^Yes, I'm aware of that. What I had in mind is - someone from some other city has to pay me some amount (or I need to pay someone in some other city). Then he can deposit a cheque (of some bank in his city) at any HDFC bank (or I deposit at any ATM of his bank, if I have to pay him) ATM in his city and it will be free. Personally, this is all that I require.

Last time someone had to pay me some amount he deposited the amount (cash) in some HDFC branch in his city and I got charged for it. They call it 3rd party cash deposit and its a nice way for them to milk you some more. Once they even had the cheek to charge me when I deposited cash myself. But I got it reversed. You gotta keep a hawk eye your transactions.

Cash beyond a certain point gets charged. Nowadays with Core Banking Facility available there are more than 200 centres in the country where you can deposit the cheque for credit into your account or vice versa. If you have an internet banking account, as both of you have account in the same bank, it can just be credited without any hassels at the drop of hat and no charges. This is way quicker and safe.

[faustus77]

Raccoon
Hi
Cash is a different thing.Only the account holder can deposit anywhere without charge.
As far as depositing a cheque goes then it is different.Anyone can deposit a cheque in your bank account by filling the payin slip and dropping at the ATM/branch.However the payer and the payee's bank should be in the depositing city.
All these facilities are the norm but a about 7/8 years back it was not so.
Dont call the call center.Call your branch customer Relation Officer.In case he is not able to answer he will find out the info and call you back.
Another way to get a reply was to send an e-mail.Got a response the next day.Easier than tearing your hair trying to get through to an executive at the call center.
Regards
PS You still have to maintain 10000 minimum if you want to go in for sweep in facility,irrespictive of the FDs

[Raccoon]

Originally Posted by gururaj r

Cash beyond a certain point gets charged. Nowadays with Core Banking Facility available there are more than 200 centres in the country where you can deposit the cheque for credit into your account or vice versa. If you have an internet banking account, as both of you have account in the same bank, it can just be credited without any hassels at the drop of hat and no charges. This is way quicker and safe.

No within and beyond points. AFAIK, HDFC will charge you whenever anyone deposits cash into your account.

Originally Posted by faustus77

Raccoon
Hi
Cash is a different thing.Only the account holder can deposit anywhere without charge.
As far as depositing a cheque goes then it is different.Anyone can deposit a cheque in your bank account by filling the payin slip and dropping at the ATM/branch.However the payer and the payee's bank should be in the depositing city.
All these facilities are the norm but a about 7/8 years back it was not so.
Dont call the call center.Call your branch customer Relation Officer.In case he is not able to answer he will find out the info and call you back.
Another way to get a reply was to send an e-mail.Got a response the next day.Easier than tearing your hair trying to get through to an executive at the call center.
Regards
PS You still have to maintain 10000 minimum if you want to go in for sweep in facility,irrespictive of the FDs

I don't think the payee's branch needs to be in your city?

I dont know who my relationship Officer is. How do I find out?

As mentioned earlier, emails to HDFC have gotten nowhere. Last time they asked me to wait for 5 working days, while they go on an expedition to Mars to find out...

[carboy]

Originally Posted by Raccoon

I don't think the payee's branch needs to be in your city?

I think it needs to be. Otherwise your branch would need to send it out-of-station for clearing & you would again get docked for fees.

[Raccoon]

^^^Not 100% sure about this, but I'm wondering - why would the cheque need to be at sent at my branch? I guessing they just need to send it to any branch of HDFC who can pass it as they would have my signature and all account details at any branch. Thats what they call branch-less banking or something similar...

That reminds me - I'v not visited my branch for eons... or maybe never! On rare ocasions I'v visited other branches to deposit cash, attestation, etc. But never my own.

[carboy]

Originally Posted by Raccoon

^^^Not 100% sure about this, but I'm wondering - why would the cheque need to be at sent at my branch?

Well - that's the difference between a par cheque and a city cheque.

[Raccoon]

^^^Ah ok. Well, I guess I'v always been using a at par cheque then.