Fixed Deposit (FD) & T-Bill Calculator 2026

Calculate your projected returns on short-to-medium term fixed deposits and treasury bills, factoring in the new 10% Withholding Tax (WHT) standard active from April 2025.

Applies to most SL fixed deposits

Final Value at Maturity

Rs. 1,112,500
Gross Interest Earned:Rs. 125,000
Withholding Tax (10%):- Rs. 12,500
Net Interest (After Tax):Rs. 112,500

How the FD and T-bill estimate is built

Gross interest is calculated as principal multiplied by the annual rate multiplied by the tenure in years. Withholding tax is then taken off that gross figure, and what remains is the interest you actually receive.

The payout choice changes where the money lands, not how much is earned. A monthly-payout deposit returns the principal at maturity and pays the net interest out in equal monthly instalments. A maturity-payout deposit returns principal plus the whole net interest as one lump sum.

Rs. 1,000,000 at 12% for one year
LineAmount
Gross interestRs. 120,000
Withholding tax at 10%Rs. 12,000
Net interestRs. 108,000
Maturity value (maturity payout)Rs. 1,108,000
Monthly payout (monthly option)Rs. 9,000

This uses simple interest, and that matters over long tenures

The calculation is deliberately simple interest: the rate is applied to the original principal for the whole term, with no compounding. For a monthly-payout deposit that is exactly right, because the interest leaves the account each month and never earns anything itself.

For a maturity-payout deposit longer than a year it is conservative. A bank that compounds interest annually will pay more than this estimate shows, and the gap widens with the tenure. Treat the figure as a floor and ask the bank for the effective annual rate if the term runs beyond twelve months.

  • Quoted rates for terms under a year are usually annualised, so a 12% one-year rate on a six-month deposit earns about 6%.
  • Senior citizens have historically had access to preferential rates and tax treatment on a limited deposit value; confirm current eligibility with the bank.
  • Treasury bills are issued at a discount rather than paying periodic interest, so their yield is quoted differently to an FD rate.

Withholding tax on interest

Withholding tax on interest income was reintroduced at 10% with effect from 1 April 2025. Banks and financial institutions deduct it at source, so the interest credited to your account is already net of it.

Because WHT is deducted at source it is not something you pay separately, but it is creditable against your final income tax liability where you have one. If you expect to be below the tax-free threshold, check with the IRD or your bank whether relief or a refund applies to you.

Comparing two deposits fairly

Two headline rates are only comparable when the tenure, the payout frequency, and the compounding convention all match. A 12% rate paid monthly and a 12% rate compounded at maturity are not the same offer.

  • Compare the effective annual rate, not the nominal quoted rate.
  • Check whether early withdrawal is permitted and what penalty applies.
  • Confirm whether the rate is fixed for the whole term or resets.
  • For amounts above the deposit insurance limit, consider spreading across institutions.

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Frequently asked questions

Withholding tax on interest income was reintroduced at 10% with effect from 1 April 2025. Banks deduct it at source, so the interest credited to your account is already net of it. On Rs. 120,000 of gross interest, Rs. 12,000 goes to WHT and Rs. 108,000 reaches you.

Simple interest throughout. For a monthly-payout deposit that is exactly right, because the interest leaves the account each month and never compounds. For a maturity-payout deposit running longer than a year the estimate is conservative, since a bank that compounds annually will pay more. Ask for the effective annual rate on any term beyond twelve months.

It depends on whether you need the income. A monthly payout gives you cash flow but the interest cannot compound. Taking it at maturity leaves the money to grow where the bank compounds. If you do not need the monthly income, a maturity deposit usually returns more over the same term.

A Treasury bill is a government security issued at a discount to its face value rather than paying periodic interest, so its yield is quoted differently to an FD rate. T-bills carry sovereign rather than bank credit risk and are traded in a secondary market, which means they can be sold before maturity, though possibly at a loss.

Quoted rates for terms under a year are usually annualised, so a 12% one-year rate earns about 6% over six months. Rates also differ by deposit size, tenure, customer category, and whether the deposit is renewed automatically. Senior citizens have historically had access to preferential rates on a limited deposit value - confirm current eligibility with the bank.

At a 10% annual rate over one year the gross interest is Rs. 100,000, from which 10% withholding tax leaves Rs. 90,000 net. Rates move constantly and differ between banks and finance companies, so use the rate your institution is actually quoting rather than a headline figure.

Yes. Withholding tax is deducted at source from the interest, so what reaches you is the net figure. This calculator applies 10% WHT to gross interest. Depending on your total income, the interest may also be relevant to your overall tax position.

T-bills carry government credit risk rather than institutional credit risk, and are usually the safer of the two. Fixed deposits often quote higher headline rates, particularly at finance companies, which is compensation for taking more risk. Compare the net-of-tax return alongside who you are lending to.

Risk varies by institution, and a higher advertised rate is generally a signal of higher risk rather than a better deal. Licensed banks and licensed finance companies are supervised differently by the Central Bank; check an institution's licensed status before committing funds.