Difference Between Salary Account and Savings Account

Most of us are introduced to the world of banking through a Regular Savings Account. The interest-bearing account offers enhanced flexibility, allowing us to deposit and withdraw funds as required.

However, to offer enhanced convenience to the customers, banks now offer a wide range of Savings Accounts. For instance, there is a Salary Account with features customized to meet working individuals' banking needs better.

But what is the difference between Salary Account and Savings Account? Let’s take a look.

What is Salary Account?

A Salary Account is a type of Savings Account, which is generally opened through an employer i.e., an account available by virtue of being employed with the employer. The interest-bearing account is used for crediting the monthly salary of the employees. At AU Small Finance Bank, you can open a Salary Account with us and unlock various benefits:

Different variants such as AU Value, AU Platinum, and AU Royale with attractive features.
Earn higher interest rate
Avail Amazon vouchers up to INR 1,250* as part of the joining benefit
Various coverages including Personal Accident Death Cover, Air Accident Death Cover, Lost Baggage Cover & Lost Card Liability Card
Get a Debit Cards with offers from leading brands

What is Savings Account?

A Savings Account is your regular interest-bearing bank account used for depositing your savings. Any resident of India who is 18 years and above having KYC documents can open an AU Savings Account with us. It helps you to not just save but also explore many financial opportunities and services:

Earn higher interest rate on your Savings Account.
Get Monthly Interest Payouts.
Access your AU Savings Account anytime with our AU 0101 App / NetBanking
Avail Amazon vouchers worth INR 300* as part of our joining benefit.
Access to feature-rich Debit Cards offering insurance cover, purchase protection and exciting offers from top brands in India
Host of service requests using our AU Video Banking facility

Difference Between Salary Account and Savings Account

	Salary Account	Savings Account
Purpose	Accounts opened with Bank through the employers for their employees to credit their monthly salaries	A Regular Savings Account is used to deposit your savings with a bank securely
Eligibility	Salary Account can only be opened for salaried employees	Anyone who is 18 years and above can open a Savings Account
Minimum Balance	Salary Accounts generally don’t have any minimum balance requirements	Most Savings Accounts have minimum balance requirements
Account Convertibility	Salary Account is converted to a Savings Account by the bank if no salary is credited into the account for a certain period (generally three months)	Savings Account can be converted into a Salary Account if an employee joins a new company that has a banking relationship with the same bank for the Salary Account of their employees

Tax Implications on Salary and Savings Account

There is no difference between Salary and Savings Accounts when it comes to tax treatment. As both the accounts are essentially Savings Accounts, the interest you earn from the accounts is taxable under the head "Income from other sources.".

However, under Section 80TTA of the IT Act, interest income of up to INR 10,000 from all the different types of Savings Accounts in a financial year is eligible for tax deductions. So, only the Savings Account interest above the threshold of INR 10,000 is taxable.

Upgrade Your Banking Experience with AU Small Finance Bank

AU Small Finance Bank offers both AU Savings Account & AU Salary Account with attractive features and benefits.
Any Indian resident with PAN & Aadhar Card can open an AU Savings Account with us through the AU Video Banking facility or visit our bank branch or call our Customer Care at 1800-1200-1200.
On the other hand, if you want to open an AU Salary Account with us, you can request your company HR team about it and share relevant details with our Relationship Manager for account opening.

*Terms and Conditions apply. Rates are subject to change at the sole discretion of AU Small Finance Bank. For more details, click here.