How is FD interest calculated?

FD interest is calculated using compound interest: A = P × (1 + r/n)^(n×t), where P is principal, r is annual rate, n is compounding frequency, and t is time in years.

What is the current best FD interest rate in India?

FD rates vary by bank and tenure. Most major banks offer 6.5–8% for standard FDs, with senior citizens getting 0.25–0.5% extra.

Is FD interest taxable?

Yes. FD interest is added to your income and taxed as per your income tax slab. TDS at 10% is deducted if interest exceeds Rs.40,000 per year.

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🏛️ Fixed Deposit (FD) Calculator

Calculate maturity amount and total interest earned on your fixed deposit investment.

Principal Amount (₹)

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Annual Interest Rate (%)

Duration

Duration Type

Compounding

💡 Quarterly compounding (4×/year) is standard for most Indian bank FDs. Compare with SIP for long-term goals.

🎯 Calculate FD returns for: SBI FD 2025 · HDFC Bank FD rates · ICICI Bank FD calculator · Post Office FD (POTD) · Senior citizen FD rates · Tax saving FD 80C · 1 year FD vs 3 year FD · Small Finance Bank FD (Unity, Utkarsh, Jana) · Corporate FD (Bajaj Finance, Mahindra) · NRE NRO FD calculator

What is a Fixed Deposit (FD)?

A Fixed Deposit (FD) is a financial instrument where you deposit a lump sum amount with a bank or NBFC for a fixed period at a predetermined interest rate. Unlike savings accounts, FD interest rates are locked in — they do not change with RBI policy during your tenure. FDs are considered one of the safest investments in India as deposits up to ₹5 lakhs are insured by DICGC.

FD Interest Formula (Compound Interest)

A = P × (1 + r/n)^(n×t)
Interest Earned = A − P

Where: P = Principal | r = Annual interest rate (decimal) | n = Compounding frequency per year | t = Tenure in years

Example: ₹1,00,000 FD for 3 Years

Principal: ₹1,00,000 | Rate: 7% p.a. | Compounding: Quarterly | Tenure: 3 years

A = 1,00,000 × (1 + 0.07/4)^(4×3)
A = 1,00,000 × (1.0175)^12 = 1,00,000 × 1.2314
Maturity Amount: ₹1,23,144 | Interest Earned: ₹23,144

FD vs Other Investment Options

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FD vs Savings Account

FD gives 6.5–8% vs savings account 3–4%. FD is better for money you won't need for 6+ months.

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FD vs Mutual Funds

FD gives guaranteed returns. Equity mutual funds target 12–15% but carry market risk. FD is better for capital protection goals.

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Tax on FD Interest

FD interest is taxable as per your income slab. If interest exceeds ₹40,000/year (₹50,000 for seniors), the bank deducts TDS at 10%.

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FD Laddering Strategy

Split ₹5L into five ₹1L FDs maturing at 1, 2, 3, 4, 5 years. This gives you liquidity every year while earning higher long-term rates.

Current Best FD Rates in India (2025)

Most major banks offer 6.5–7.5% for general customers and 0.25–0.5% extra for senior citizens. Small Finance Banks like Unity SFB, Utkarsh SFB offer higher rates of 8–9% but carry slightly higher risk. Always verify with your bank as rates change with RBI repo rate decisions.

Tax Saving FD: 5-year FDs qualify for deduction up to ₹1.5 lakh under Section 80C but interest is fully taxable and premature withdrawal is not allowed.