Section 80TTA of Income Tax Act allows deduction up to ₹10,000 on the income earned as interest from a savings account. At interest rate for savings account, a principal of ₹ would generate ₹10,000 as interest in a year. The effective amount of interest you would make for the same principal in fixed deposit scheme would differ based on the tax slab (slab 1 - 10%, slab 2 - 20%, slab 3 - 30%) you belong to. You should use fixed deposit scheme as long as the interest rate is higher than , , for slab 1, slab 2 and slab 3 respectively.