Personal Finance

Everything About FD, FD Calculator & TDS Savings


With the current state of the world, people are seeking a more secure investment. One of the most popular ways to do the same is through a fixed deposit (FD).

This investment product attracts people because of its low risk, guaranteed returns and immediate liquidity. This post will answer all your questions concerning fixed deposits, fixed deposits calculator and TDS savings.

Everything About FD

Know FD and its Types?

FD is an investment that resembles the feature of a savings account. Banks and other financial institutions mostly offer it with a fixed rate of return and maturity date. However, the interest rate on FDs is higher than that of a savings account. The main advantage of investing in FD is that it offers the safety of capital and guaranteed returns.

Types of FD

  • Regular FD: Regular FD accounts are where you deposit money at a specific interest rate for a specific period.
  • Flexi Fixed Deposit: These FDs give you the ease and adaptability of both a savings and an FD account. Get the liquidity of savings accounts and the higher interest rates of FDs in this fixed-rate deposit account.
  • Tax-Saving FDs: The investor gets regular FD benefits with a tax savings advantage in this FD.
  • Senior Citizens Fixed Deposit: Tailored for people 60 years and above with features like high-interest rates than a regular FD.

Interest Calculation – Cumulative and Non-Cumulative

Cumulative and non-cumulative fixed deposits are FDs based on interest payout. A cumulative fixed deposit provides the interest payout on the maturity date. In contrast, a non-cumulative fixed deposit gives interest payouts regularly. In a non-cumulative FD account, the time between interest payments ranges from monthly to quarterly and, in some cases, semi-annually.

Since the bank does not withhold the interest in a non-cumulative FD, you will get a consistent payout. Thus, it provides less interest than cumulative FD because the power of compounding is not realised.

Is a fixed deposit taxable?

FD holders are eligible for a deduction of Rs 1.5 Lakh from their taxable income under  80C Income tax act 1961 for the amount invested in an FD.

However, the interest earned from a fixed deposit for 6 months or any other chosen is taxable, and the same is deducted at the source. The interest income is added under the section “Income from other sources” and is taxable as per the account holder’s income tax slab.

TDS on fixed deposit interest income

The bank deducts TDS from the interest collected on the fixed deposit before paying it to the depositors.

However, for non-senior and senior citizens, the TDS is considered if the interest on FDs exceeds Rs. 40,000 or Rs. 50,000 in a financial year.

Banks must deduct TDS at a rate of 10% from the deposits. However, if the depositor fails to furnish a Permanent Account Number (PAN), the bank will impose a TDS withholding of 20%.

What is a fixed deposit calculator?

A fixed deposits calculator is a tool that assists applicants in estimating their anticipated profits after a fixed deposit tenure. This calculator is accessed online and is free of cost. It considers the principal amount, term, and appropriate interest rate to determine the final maturity amount.

To assist you in making a wise financial decision, the fixed deposits calculator estimates your earnings based on the amount you invest in a fixed deposit for 6 months or other tenures.


In conclusion, fixed deposits can provide a balance to one’s portfolio as they do not involve risk. However, market-linked products like stocks and mutual funds do.

First, ensure that the bank or financial institution with whom you create an FD is reliable. RBL Bank is a suitable option as it fully lets you enjoy the advantages of fixed deposits. Furthermore, RBL Bank offers a broad range of financial services that may easily assist you in satisfying your short and long-term needs.

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About the author

Rishabh Agarwal