Fixed Deposit Calculator
Calculate what your fixed deposit will be worth at maturity, how much interest it earns, and what you actually keep after tax.
| Year | Opening balance | Interest earned | Closing balance |
|---|
Fixed deposits explained
A fixed deposit is an arrangement where you place a lump sum with a bank or non-banking finance company for an agreed period at an agreed rate. The rate is locked in when you open the deposit, so subsequent rate changes in the market do not affect your existing FD.
Deposits with scheduled banks are insured up to ₹5,00,000 per depositor per bank by the Deposit Insurance and Credit Guarantee Corporation. That cover includes both principal and accrued interest, and it applies per bank rather than per account.
The compound interest formula
Most Indian banks compound quarterly, which is why the effective yield sits slightly above the stated rate. A ₹5,00,000 deposit at 7.1% for five years with quarterly compounding matures at roughly ₹7,11,600, giving interest of about ₹2,11,600.
Why compounding frequency matters
Same deposit of ₹5,00,000 at 7.1% for five years, with different compounding:
| Compounding | Maturity amount | Interest | Effective yield |
|---|---|---|---|
| Annually | ₹7,04,700 | ₹2,04,700 | 7.10% |
| Half yearly | ₹7,08,100 | ₹2,08,100 | 7.23% |
| Quarterly | ₹7,11,600 | ₹2,11,600 | 7.29% |
| Monthly | ₹7,13,300 | ₹2,13,300 | 7.33% |
Indicative FD rates
| Institution type | 1 year | 3 years | 5 years | Senior citizen bonus |
|---|---|---|---|---|
| Large public sector banks | 6.6% to 6.9% | 6.7% to 7.1% | 6.5% to 7.0% | +0.50% |
| Large private banks | 6.6% to 7.1% | 7.0% to 7.3% | 6.9% to 7.2% | +0.50% |
| Small finance banks | 7.5% to 8.5% | 7.8% to 8.8% | 7.5% to 8.5% | +0.50% to 0.75% |
| Post Office time deposit | around 6.9% | around 7.1% | around 7.5% | Not applicable |
| Corporate FDs (AAA rated) | 7.2% to 8.0% | 7.5% to 8.3% | 7.5% to 8.5% | +0.25% to 0.50% |
Indicative ranges as of October 2026. Rates change frequently, so confirm the current figure with the bank before opening a deposit. Small finance bank and corporate deposits carry more credit risk than large bank deposits.
Types of fixed deposit
- Cumulative FD. Interest compounds and is paid entirely at maturity. Best when you do not need regular income.
- Non-cumulative FD. Interest is paid out monthly, quarterly or annually. Suits retirees who need a steady inflow.
- Tax saving FD. Five-year lock-in, qualifies for Section 80C under the old regime. Premature withdrawal is not allowed.
- Senior citizen FD. Available from age 60, typically paying 0.25% to 0.75% more than the general rate.
- Flexi or sweep-in FD. Linked to your savings account. Surplus above a threshold moves automatically into a deposit.
- Recurring deposit. Not strictly an FD. You deposit a fixed sum every month rather than one lump sum.
How FD interest is taxed
Interest from a fixed deposit is fully taxable as income from other sources, added to your total income and taxed at your slab rate. There is no special concessional treatment, which is why the post-tax return often disappoints.
| Your slab | Gross rate | Tax on interest | Post-tax return |
|---|---|---|---|
| Nil | 7.1% | Nil | 7.10% |
| 5% | 7.1% | 5% | 6.75% |
| 10% | 7.1% | 10% | 6.39% |
| 20% | 7.1% | 20% | 5.68% |
| 30% | 7.1% | 30% | 4.97% |
On TDS. Banks deduct tax at source at 10% once interest paid to you in a financial year crosses ₹50,000 for general depositors, or ₹1,00,000 for senior citizens. If your total income falls below the taxable limit, submit Form 15G, or Form 15H if you are a senior citizen, at the start of the year to stop the deduction. TDS is not an extra tax; it is credited against your final liability.
Fixed deposits compared with other options
| Option | Typical return | Risk | Lock-in | Taxation |
|---|---|---|---|---|
| Bank FD | 6.5% to 7.5% | Very low | Flexible, penalty on early exit | Slab rate |
| PPF | around 7.1% | None, sovereign | 15 years | Fully exempt |
| Debt mutual fund | 6% to 8% | Low to moderate | None | Slab rate |
| Arbitrage fund | 5.5% to 7% | Low | None | Equity taxation |
| Equity mutual fund | 11% to 14% long term | High | None | 12.5% LTCG above ₹1.25L |
Making the most of fixed deposits
- Ladder your deposits across different maturities so you always have some money coming free.
- Compare small finance banks for better rates, but stay within the ₹5,00,000 insurance cover per bank.
- Open the deposit in the name of a lower-earning family member where the interest would be taxed less.
- Choose quarterly or monthly compounding over annual when both are offered at the same rate.
- Submit Form 15G or 15H in April if your income is below the taxable threshold.
- Check the premature withdrawal penalty, usually 0.5% to 1%, before locking in a long tenure.
- If you are in the 30% slab and can accept some volatility, compare against arbitrage or debt funds.
Frequently asked questions
Fixed deposits use compound interest: A = P x (1 + r/n)^(n x t). Most Indian banks compound quarterly, which is why the effective yield sits slightly above the stated rate. Our calculator lets you pick quarterly, monthly, half-yearly or annual compounding.
Deposits with scheduled banks are insured up to 5,00,000 per depositor per bank by the DICGC, covering both principal and accrued interest. Spread larger sums across banks to stay within the cover. Corporate and small finance bank deposits carry more credit risk.
Interest is fully taxable as income from other sources at your slab rate. There is no concessional treatment. A 7% FD returns about 4.9% after tax if you are in the 30% bracket, which is worth factoring into any comparison.
Banks deduct 10% TDS once interest paid to you in a financial year crosses 50,000, or 1,00,000 for senior citizens. Submit Form 15G, or Form 15H if you are a senior citizen, at the start of the year if your total income is below the taxable limit. TDS is credited against your final liability.
Yes. Most banks offer senior citizens aged 60 and above an additional 0.25% to 0.75% over the general rate. Some banks run special schemes with even higher rates for super senior citizens.
Premature withdrawal usually attracts a penalty of 0.5% to 1%, and interest is recalculated at the rate applicable to the period actually completed rather than the original booked rate. Tax saving FDs with a five-year lock-in cannot be withdrawn early at all.