Recurring Deposit (RD) Calculator
RD Maturity Details
⚠️ Calculated using quarterly compounding (standard Indian bank method). Actual amounts may vary slightly by bank. Interest is taxable as per your income tax slab. TDS at 10% applies if interest exceeds Rs.40,000/year (Rs.50,000 for senior citizens).
RD Rates — Major Banks (2025–26)
| Bank | General Rate | Senior Citizen Rate | Tenure Range |
|---|---|---|---|
| State Bank of India (SBI) | 6.5–7.0% | 7.0–7.5% | 1–10 years |
| HDFC Bank | 6.5–7.25% | 7.0–7.75% | 6 months – 10 years |
| ICICI Bank | 6.7–7.5% | 7.2–8.0% | 6 months – 10 years |
| Axis Bank | 6.75–7.75% | 7.25–8.25% | 6 months – 10 years |
| Post Office RD | 7.5% (fixed) | 7.5% | 5 years |
Rates as of early 2025. Verify current rates with your bank before opening an RD account.
How RD Interest is Calculated
Indian banks calculate RD interest using quarterly compounding. The formula is:
M = R × [(1+i)^n − 1] / (1 − (1+i)^(−1/3))
Where: R = Monthly installment, i = Rate of interest per quarter (Annual rate ÷ 400), n = Number of quarters
Alternatively, each monthly deposit is treated as a separate FD maturing at the end of the tenure, and the total maturity is the sum of all these individual FDs.
- RD interest is compounded quarterly in India (unlike simple interest on some short-term deposits)
- Post Office RD also uses quarterly compounding at a government-declared rate
- TDS is deducted at 10% if total annual interest exceeds Rs.40,000 (Rs.50,000 for seniors)
- Submit Form 15G/15H if your income is below taxable limit to avoid TDS
Frequently Asked Questions
Missing an RD installment typically results in a penalty ranging from Rs.1 to Rs.2 per Rs.100 per month of default, depending on the bank. Some banks allow a grace period (typically 3–5 days) without penalty. If payments are missed for 3–6 consecutive months, most banks may close the RD prematurely. Post Office RD allows a maximum of 4 defaults and charges Rs.1 per Rs.100 per month.
Yes, most banks allow loans against RD as collateral — typically up to 80–90% of the deposited amount (not maturity value) at an interest rate slightly above the RD rate. This is useful for short-term financial needs without breaking the RD. The RD continues to earn interest even while the loan is outstanding. Contact your bank for specific terms and conditions.
Yes, RD interest is fully taxable as "Income from Other Sources" and added to your total income, taxed at your applicable slab rate. TDS at 10% is deducted if aggregate interest from all deposits in a bank exceeds Rs.40,000 per financial year (Rs.50,000 for senior citizens). You can submit Form 15G (or 15H for seniors) to the bank to avoid TDS if your total income is below the taxable threshold.
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