How is FD interest taxed in India?

FD interest is fully taxable as per your income tax slab. Banks deduct TDS (Tax Deducted at Source) at 10% if the annual interest exceeds ₹40,000 (₹50,000 for senior citizens).

Can I withdraw my Fixed Deposit prematurely?

Yes, but banks usually charge a penalty of 0.5% to 1% on the applicable interest rate for premature withdrawals.

Which compounding frequency offers the highest return?

Higher compounding frequency yields higher returns. Monthly compounding earns slightly more than quarterly compounding, which earns more than yearly compounding.

Are Fixed Deposits safe?

Yes, in India, bank deposits are insured up to ₹5 Lakhs per bank per depositor by the DICGC (Deposit Insurance and Credit Guarantee Corporation).

Secure•100% Client-Side

Fd Calculator

Calculate maturity value and interest earned on a Fixed Deposit.

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Parameters

Display Currency

Deposit Amount₹

010 Cr

Interest Rate (p.a.)%

015

TenureYears

120

Calculation Results

Maturity Value

₹7.11 L

Deposit Amount

₹5.00 L

Total Interest Earned

₹2.11 L

Maturity Value₹7.11 L

Principal₹5.00 L (70%)

Interest₹2.11 L (30%)

Growth Projection Over Time

Yr 0

Yr 1

Yr 2

Yr 3

Yr 4

Yr 5

Total Investment

Total Interest Earned

Year-by-Year Growth Breakdown

Yearly projection of invested capital, interest earned, and total balance.

Year	Invested	Interest	Balance
Year 1	₹5.00 L	₹36,456	₹5.36 L
Year 2	₹5.00 L	₹75,571	₹5.76 L
Year 3	₹5.00 L	₹1.18 L	₹6.18 L
Year 4	₹5.00 L	₹1.63 L	₹6.63 L
Year 5	₹5.00 L	₹2.11 L	₹7.11 L

Calculator Guide & Math

1How Fixed Deposit Compounding Works

A Fixed Deposit (FD) guarantees a fixed rate of return over a set tenure. Banks compound interest periodically (typically quarterly) and add it to your principal, meaning you earn interest on interest.

Formula & Math Explanation

A = P × (1 + R / (100 × N))^(N × T)

•A = Total maturity value after tenure.
•P = Principal amount invested.
•R = Annual interest rate percentage.
•N = Number of compound periods per year (12 for monthly, 4 for quarterly, 2 for half-yearly, 1 for yearly).
•T = Tenure duration in years.

2Fixed Deposit Maturity Example

You invest ₹1,00,000 in a fixed deposit for 5 years at an interest rate of 7% per annum compounded quarterly.

Identify parameters: Principal = 1,00,000, Rate = 7%, Years = 5, Compounding = Quarterly (N = 4).
Apply formula: A = 1,00,000 × (1 + 7 / 400)^(4 × 5).
Calculate exponent and base: (1 + 0.0175)^20 = 1.0175^20 = 1.414778.
Multiply by principal: Maturity value = ₹1,41,478.

Result Summary: At maturity, your investment is worth ₹1,41,478, yielding ₹41,478 in compound interest.

Fixed Deposit FAQs

An FD is a financial instrument offered by banks and NBFCs where investors deposit a sum of money for a fixed tenure at a guaranteed interest rate.