FD Calculator
Estimate fixed deposit maturity amount and interest earned.
UseBanking
Simple Interest Calculator
Calculate simple interest and total amount on a principal for a given rate and period. Includes tax impact, CA notes, ad-ready layout, and a full period breakup table.
Step 1
8% p.a.Simple interest details
CA view: interest is usually taxable at slab rate unless a specific exemption applies. TDS is only advance tax, not the final tax liability.
Step 2
6.34% post-tax yieldBanking estimate
Total amount₹1,36,000Estimated amount after tax impact on interest.
Gross interest₹40,000Before personal tax.
Estimated tax₹4,000Based on 10% tax rate.
Principal₹1,00,000Original principal amount.
Step 3
₹1.36 LInterest breakup
CA inputs
Simple interestFinance notes
Tax check₹4,000Interest income generally goes under income from other sources and is taxed at slab rate.
Liquidity checkLock-in mattersPremature closure, missed RD payments, and bank penalties can reduce final returns.
Compound comparison₹6,933Extra gross interest compounding may earn over simple interest.
Breakup table
5 rowsYearly simple interest breakup
Shows the same interest earned each year because simple interest is calculated only on principal.
| Period | Opening | Fresh Principal | Interest | Tax | Closing |
|---|---|---|---|---|---|
| Year 1 | ₹1 L | ₹1 L | ₹8,000 | ₹800 | ₹1.07 L |
| Year 2 | ₹1 L | ₹0 | ₹8,000 | ₹800 | ₹1.14 L |
| Year 3 | ₹1 L | ₹0 | ₹8,000 | ₹800 | ₹1.22 L |
| Year 4 | ₹1 L | ₹0 | ₹8,000 | ₹800 | ₹1.29 L |
| Year 5 | ₹1 L | ₹0 | ₹8,000 | ₹800 | ₹1.36 L |
Simple Interest Calculator for Indian banking decisions
Simple interest is charged only on the original principal, so the interest amount stays the same every year. Informal lending, some gold loans, and many short-term arrangements use simple interest.
For multi-year money, always check whether the quote is simple or compound — the gap grows every year and becomes very large over long periods.
How to use this result
Compare the gross return with the post-tax amount, because bank interest is usually taxable. Also compare the rate with inflation before deciding whether the product is suitable for short-term safety or long-term wealth creation.
Simple Interest Calculator FAQs
What is the simple interest formula?
SI = P × R × T / 100, where P is principal, R is the annual rate, and T is time in years.
Where is simple interest used in India?
Common examples include gold loans at some lenders, informal personal lending, security deposits, court-awarded interest, and education loan interest during moratorium.
Is FD interest simple or compound?
Cumulative FDs compound quarterly. Payout FDs effectively pay simple interest because interest is withdrawn instead of reinvested.