FD Calculator India 2026: Best Fixed Deposit Rates and Tax Guide
Updated April 2026 · 10 min read
Fixed Deposit Rates in India: Complete 2026 Comparison
Fixed deposits remain India most popular savings instrument, but rates vary significantly between banks. Getting 7.5 percent instead of 6.5 percent on a Rs 10 lakh FD earns you Rs 10,000 more per year in interest — for doing nothing more than choosing a different bank. Use our savings calculator to compare FD options.
Major bank rates (2026): SBI offers 6.50 to 7.10 percent, HDFC Bank 7.00 to 7.40 percent, ICICI 6.90 to 7.25 percent, and Bank of Baroda 6.75 to 7.25 percent. Small finance banks like AU, Ujjivan, and Equitas offer 7.50 to 9.00 percent. Post office time deposits offer 7.00 to 7.50 percent with sovereign guarantee. Senior citizens receive an additional 0.25 to 0.50 percent at most banks.
FD Laddering: The Strategy Smart Investors Use
Instead of putting Rs 10 lakh in one FD, split it into 5 FDs of Rs 2 lakh each with 1-year, 2-year, 3-year, 4-year, and 5-year maturities. Every year, one FD matures. Reinvest it at the 5-year rate (typically the highest). After 5 years, all your money earns the highest rate while one FD matures annually for liquidity. This gives you the best of both worlds: highest rates and regular access to funds.
TDS on FD Interest: What You Must Know
Banks deduct TDS at 10 percent if your total FD interest across all branches of that bank exceeds Rs 40,000 in a year (Rs 50,000 for senior citizens). If you do not have taxable income, submit Form 15G (or 15H for seniors) to avoid TDS deduction. Remember: TDS is not your final tax — you must still declare FD interest in your ITR and pay any additional tax owed at your slab rate. Use our compound interest calculator to see how taxes reduce your real FD returns compared to tax-free options like PPF.
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Frequently Asked Questions
What is the best FD rate in India 2026?
Small finance banks offer the highest rates at 7.5 to 9.0 percent. Among major banks, HDFC offers 7.00 to 7.40 percent and SBI offers 6.50 to 7.10 percent. Senior citizens get an additional 0.25 to 0.50 percent from most banks.
Is FD interest taxable?
Yes. FD interest is taxed at your income tax slab rate. TDS of 10 percent is deducted by the bank if annual interest exceeds Rs 40,000 (Rs 50,000 for senior citizens). You must declare all FD interest in your ITR even if TDS is already deducted.
What is a tax-saver FD?
A 5-year FD that qualifies for Section 80C deduction up to Rs 1.5 lakh. Interest earned is still taxable. The lock-in is strict — no premature withdrawal allowed. Available at all major banks. Compare with ELSS which also has tax benefits but potentially higher returns.
Should I choose cumulative or non-cumulative FD?
Cumulative FD reinvests interest and compounds, giving higher maturity value. Non-cumulative pays interest monthly or quarterly. Choose cumulative if you do not need the income now. Choose non-cumulative if you depend on FD interest for living expenses.
Is FD safe if the bank fails?
DICGC insures deposits up to Rs 5 lakh per depositor per bank. For amounts above Rs 5 lakh, spread across multiple banks. Stick to scheduled commercial banks for large FDs. Small finance banks are also insured but carry slightly higher risk.