India FD Calculator

Fixed deposits lock funds at a banks for a chosen tenure (7 days to 10 years) at a fixed interest rate. Current rates (early 2025): 6.5-7.5% for general public, 7-8% for senior citizens (extra 0.5% bank-wide standard), small finance banks offer up to 8.5-9%. Compounding can be quarterly (most common), monthly, or simple interest depending on bank and product.

₹1 lakh in a 5-year FD at 7% with quarterly compounding grows to ₹1.41 lakh - about ₹41,000 of interest. Senior citizens at 7.5%: ₹1.43 lakh, about ₹43,500 interest. The compounding frequency matters: quarterly compounding produces noticeably more than annual at the same nominal rate.

Interest is fully taxable as 'income from other sources' at your marginal rate. TDS at 10% applies if interest from a single bank exceeds ₹40,000/year (₹50,000 for senior citizens). If your total income is below the basic exemption (₹3 lakh), submit Form 15G (under 60) or 15H (senior) to avoid TDS.

TDS doesn't reduce your final liability - it's adjusted at filing. So if you're in the 30% bracket, the bank deducts 10% as TDS but you owe another 20% at filing. Many investors split FDs across multiple banks specifically to stay under the ₹40,000 threshold per bank, simplifying administration even if it doesn't save tax.

Banks offer special tax-saving FDs that qualify for Section 80C deduction up to ₹1.5 lakh, with mandatory 5-year lock-in. Interest rate is usually similar to regular 5-year FDs. The 80C benefit only applies under old regime; new regime ignores it.

Trade-off vs PPF: tax-saving FD interest is fully taxable; PPF interest is tax-free. So even though both qualify for 80C, PPF's net yield is materially better for most taxpayers. Tax-saving FDs make sense if you don't have PPF room or want shorter lock-in flexibility. The [India PPF Calculator](/india-ppf-calculator) handles the PPF math.

Premature withdrawal usually attracts a penalty: typically 0.5-1% reduction from the rate that would have applied for the actual holding period. So a 5-year FD broken at year 2 might earn the 2-year rate minus 0.5-1%. Some special FD products waive penalty for limited withdrawals or in case of medical emergency.

Auto-renewal is the default unless you opt out. At maturity, the bank re-deposits at the prevailing rate for the original tenure. This can be lower than what you started with if rates have fallen, or higher if they've risen. Check at maturity whether to keep auto-renewal or shift to a better-rate alternative.