FD Calculator
What your fixed deposit pays at maturity: interest compounded every quarter, simple interest under 6 months, or a quarterly payout.
₹1 lakh in a 5-year FD at 7% a year, compounded every quarter, grows to about ₹1,41,478: ₹41,478 of interest. Banks compound cumulative FDs every quarter and pay simple interest on deposits under 6 months.
The words on this page, explained simply
New to this? Here is what each term means, in plain English.
- Fixed deposit (FD)
- Money left with a bank for a fixed time at a fixed interest rate.
- Compounded quarterly
- Interest is added every three months and then itself earns interest, so the real yearly gain is a little more than the stated rate.
- Maturity
- The day a deposit or scheme ends and pays you out. The maturity value is what you get that day.
- Effective yield
- The real yearly gain once compounding is counted. 7.5% compounded every quarter works out to about 7.71% a year.
- TDS on FD interest
- Tax the bank cuts from your FD interest before paying it: 10% once interest from that bank goes above ₹50,000 in a year (₹1 lakh if you are 60 or over). You count it against your tax when you file your return. Form 15G or 15H stops it if your income is below the taxable limit.
- Tax slab
- The income-tax rate for your income band. Dividends are added to your income and taxed at your slab rate.
A fixed deposit locks your money with a bank for a fixed time at a fixed rate. In a cumulative FD the interest is added to the deposit every quarter and earns interest itself, and you get everything at the end. In a payout FD the interest is paid out to you every quarter instead.
How banks calculate FD interest
Cumulative FD: maturity = deposit × (1 + rate ÷ 4)^(number of quarters). Days left over after the last full quarter earn simple interest. Deposits of less than 6 months earn simple interest: deposit × rate × days ÷ 365.
Quarterly payout: you get deposit × rate ÷ 4 every quarter, and the deposit back at the end.
| ₹1 lakh at SBI's rate for | Maturity value |
|---|---|
| 1 year | ₹1,06,398 |
| 2 years | ₹1,13,540 |
| 3 years | ₹1,20,626 |
| 5 years | ₹1,35,018 |
SBI's rates for the general public; see the SBI FD calculator for every tenure and senior citizen rates. Banks round a few rupees differently.
Tax and TDS on FD interest
Banks deduct 10% TDS when your FD interest from one bank goes above ₹50,000 in a tax year (₹1 lakh for senior citizens), or 20% without a PAN. Submit Form 15G (15H if you are 60 or over) if your total income is below the taxable limit. FD interest is taxed at your slab rate either way.
Effective yield
Because interest is compounded every quarter, a 7% FD actually earns about 7.19% a year. The calculator shows this as the effective yield, which is the number to compare with a scheme that compounds once a year.
Key takeaways
- Cumulative FD: interest compounded every quarter; simple interest under 6 months.
- 7% compounded quarterly = 7.19% a year effective.
- TDS at 10% above ₹50,000 of interest a year per bank (₹1 lakh for seniors).
Frequently asked questions
How is FD interest calculated?
Banks compound it every quarter: maturity = deposit × (1 + rate ÷ 4)^quarters. Deposits under 6 months earn simple interest.
How much will ₹1 lakh give in an FD for 5 years?
At 7% a year, about ₹1,41,478, of which ₹41,478 is interest.
Is FD interest taxable?
Yes, at your income-tax slab rate, every year as it is earned, even in a cumulative FD where you get it only at maturity.
When does the bank deduct TDS on FD interest?
When interest from that bank exceeds ₹50,000 in a tax year (₹1 lakh for senior citizens). The rate is 10%, or 20% without a PAN.