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Tax on FD Interest Calculator

Post-tax return on a fixed deposit. Interest is taxed at slab on accrual each year, so a 7.25 percent deposit returns about 5 percent to a thirty percent taxpayer, which is below most inflation estimates.

Also called: fd tax calculator, post tax fd return.

₹
%
%
Deduction available
Maturity value after tax
₹11,68,383

₹11,68,383 after tax, from a gross maturity of ₹12,40,547. Tax of ₹72,164 reduces the effective rate from 7.25% to 5.32%, which against inflation is a real return of likely negative at typical inflation.

Before tax
₹12,40,547
Gross interest
₹2,40,547
Tax on the interest
₹72,164
Post-tax rate
5.32%
Tax each year
₹24,055
Value of the deduction
₹0
On real return
likely negative at typical inflation.
How this is calculated

Computed from the published rates for the tax year you selected, which is not necessarily the current year. A calculation, not tax advice, and it does not know anything about your circumstances beyond the figures entered.

Method and background

This is what the calculation gives for the numbers you entered. It is an estimate, not advice, and it knows nothing about your situation beyond those numbers. Rules for India change on a published schedule; the effective date is shown on every rule-based tool.

How this is calculated

FD interest is fully taxable at your slab and, importantly, taxable in the year it accrues rather than when the deposit matures. A cumulative deposit therefore creates a tax liability in years when no cash has been received. The post-tax rate is simply the headline rate less your slab share, which for a higher-rate taxpayer takes most deposits below the inflation rate and makes the real return negative.

FD interest is taxed at slab each year on accrual, so the post-tax rate is the headline less your slab
t
Tax slab

Worked examples

Each of these is asserted on every build. If a change to the engine ever moved one of these answers, the build would fail before the page could print it.

ten lakh for three years at a 30 percent slab

Deposit amount
₹10,00,000
Interest rate
7.25%
Tenure
3
Tax slab
30%
Deduction available
None

Maturity value after tax₹11,68,383

10L x (1 + 0.0725/4)^12

Open this example

a nil slab keeps the whole return

Deposit amount
₹10,00,000
Interest rate
7.25%
Tenure
3
Tax slab
0%
Deduction available
None

Maturity value after tax₹12,40,547

boundary: the effective quarterly-compounded rate

Open this example

Method and limits

What it assumes

  • Tax paid annually on accrual, which is the correct treatment.

What it deliberately does not model

  • 80TTA covers savings account interest only, not fixed deposits.
  • 80TTB covers deposit interest for those aged sixty and above, and both are old regime only.

Formula version 1.0.0 · definition 1.0.0 · India · Report a problem with this calculator

Frequently asked questions

Is FD interest taxed only at maturity?
No, it accrues and is taxable each year even on a cumulative deposit where you receive nothing until the end. Many people discover this when a Form 26AS shows income they did not expect.
Does 80TTA cover fixed deposits?
No, only savings account interest. 80TTB does cover deposits but is available only to those aged sixty and above.