While most individual tax payers are aware that interest income is taxable, there are seven types of interest incomes that they are likely to forget to include in their income tax return ITR ).Payment Banks are new concepts in the market. These banks provide various services like a normal bank, i.e., they pay interest on deposits, issue wallets, allow online payments, so on and so forth. In case you also have an account with a payment bank and have earned interest on deposits in such a bank then that interest is also taxable under the head 'Income from other sources'.Chartered accountant Naveen Wadhwa, DGM at taxmann.com says ''Interest on deposits with Payment Banks is taxable as per method of accounting regularly followed by the taxpayer. If taxpayer follows mercantile system of accounting, such interest shall be taxable in the year of accrual itself even if it is not received during the year. In case of cash basis of accounting, the interest is taxable in the year in which it is received”. If interest is not disclosed in the Income-tax return, it will be tantamount to under-reporting of income which would attract penalty of 50% of tax sought to be evaded."It is a common practice for banks, particularly public sector banks, to make it mandatory for customers hiring safe deposit lockers from them, to place fixed deposits linked to these lockers. That is, a customer wanting to hire a safe deposit locker in the bank's vault not only has to pay annual rent for the locker but also place a fixed deposit with the bank. This fixed deposit is linked to the locker.The minimum fixed deposit amount for this purpose varies from bank to bank but is normally not a large amount - mostly less than Rs 50,000. The FD is kept as a security deposit for the locker. The interest earned on the FD may be used to fund the rent payment for the locker or credited to the person's savings account with the bank or reinvested with the FD itself (in case of cumulative FDs).The FD tenure is normally several years as the deposit has to be kept with the bank as long as the locker is being used. As the principal amount of these FDs is small, often the interest per annum does not cross the interest limit of Rs 10,000 (per annum) beyond which tax is deductible at source on the interest by the bank.Consequently, TDS does not get deducted on this interest if this is the only FD that the person holds with that bank i.e. total interest income from FDs from one bank does not exceed Rs 10,000 in one year.If the interest on such FDs is straightaway debited for the locker rent or the FD is a cumulative one, there is no corresponding interest entry in the savings account passbook of the person. As a result, the tax payer may well forget to include this interest, which is very much taxable, in his/her income tax return. It is to be noted that this interest is taxable even if it is being used to pay the locker rent.Bond issues are floated from time to time by corporates, public sector undertakings and financial institutions. For example, several bond issues have been floated in the past by The National Highways Authority of India, the Indian Railway Finance Corporation, the Housing and Urban Development Corporation, the Indian Renewable Energy Development Agency, NTPC, the Rural Electrification Corporation and the Power Finance Corporation.In case the bond issue is viewed as an attractive investment it is often oversubscribed.Oversubscription means that a large number of applicants would receive partial allotment and refund of the balance amount of application money (for non-ASBA applicants). Along with allotment letters and refunds, Non-ASBA applicants would receive interest on application money and also interest on the amount refunded.This interest, being only for a certain number of days, is a small amount (a few thousand rupees generally) and often gets overlooked for that reason. Further, if the interest amount is clubbed with the refund amount or with the first interest payment on the bonds (in case of bond issues) then also the chance of it getting overlooked is high. However, this interest on application money or/and on refund also has to be included in taxable income Electricity and telecommunication suppliers (government as well as private sector-e.g MTNL ) often require subscribers to give one-time security deposits at the time of applying for the connection. These deposits remain with the supplier as long as the connection is kept by the subscriber (i.e till it is surrendered back). Many suppliers pay interest on these deposits to the subscribers.The rate of interest, frequency of payment and the deposit amount varies from supplier to supplier. In most cases where the supplier pays interest it is credited to the account of the subscriber or subtracted from the bill at the end of the financial year. This interest credit/payment, which is reflected in the relevant bill is also taxable interest and needs to be added to the subscriber's gross total income for the relevant financial year.The National Savings Certificates (NSC) currently on sale at post offices are of five year tenure. Interest on NSCs is cumulative i.e. is earned yearly but paid on maturity. The amount invested in NSCs at the time of purchase and also the interest accrued yearly can be claimed as a deduction from taxable income under Section 80C of the Income Tax Act subject to the total limit under this section -Rs 1.5 lakh for FY15-16, FY16-17, and FY17-18.The interest accruing yearly on NSCs is deemed reinvested and therefore qualifies for deduction under Section 80C within this total limit. However, the interest accrued on the NSC in the last year of the certificate's term gets paid out on maturity and is therefore not reinvested.Consequently, the interest on NSCs accruing in the last year cannot be claimed as a deduction from taxable income under Section 80C and is therefore to be added to taxable income in the year of accrual, says Sachin Vasudeva, a practising chartered accountant and Senior partner with Delhi-based firm SC Vasudeva & Co.Interest on Public Provident Fund accounts, credited annually, is currently tax-exempt. However, even so, one needs to declare it as 'Income claimed exempt from tax' on an yearly basis in one's tax returns, adds Vasudeva. This is something most people with PPF accounts forget to do.In case you have received interest on delayed refund of income tax then that interest is also taxable and needs to be added to your gross total income for the year in which the refund is received. Chartered accountant Abhishek Soni who is CEO at Tax2Win.in says ''Income Tax Refund is not taxable but yes, the interest received on it is surely taxable. It is taxable in the year in which such refund is received under the head income from other sources. The amount of tax would be calculated as per the applicable slab rate. Further, it is also reflected in your Form 26AS so you can trace it easily there. Form 26AS shows the amount of refund and interest on it separately''