Post Office FD Calculator — Time Deposit Maturity Value 2026-27

Post Office FD Calculator — Time Deposit Maturity Value

How Post Office Time Deposit (FD) works

Post Office Time Deposit (TD) — commonly referred to as Post Office FD — is a lump-sum, fixed-rate savings instrument offered by India Post. It is the closest equivalent to a bank fixed deposit, but backed by the sovereign guarantee of the Government of India.

Key mechanics:

Minimum deposit: ₹1,000 (in multiples of ₹100). No maximum limit.
Available terms: 1 year, 2 years, 3 years, 5 years.
Interest: Compounded quarterly and paid at maturity (not monthly).
Sovereign backing: Government of India guarantee — no DICGC cap applies.

Current rates (Q1 FY 2026-27)

Term	Annual rate	Effective yield (quarterly compounding)
1 year	6.9%	~7.09%
2 years	7.0%	~7.19%
3 years	7.1%	~7.31%
5 years	7.5%	~7.71%

The 5-year term offers the highest rate and is the only tenure eligible for Section 80C deduction.

Premature closure rules

Time elapsed	Interest paid
Less than 6 months	No interest — principal only
6 months to 1 year	Post Office savings rate (4% p.a.)
After 1 year	Applicable TD rate for completed years minus 1% penalty

Section 80C eligibility

Only the 5-year Post Office Time Deposit qualifies for deduction under Section 80C, up to ₹1,50,000 per financial year. The lock-in period for tax-saving purposes is 5 years — premature closure forfeits the 80C deduction (and any tax already saved may be added back to income).

Feature	5-year Post Office FD	Bank Tax-Saver FD
80C eligibility	Yes	Yes
Lock-in	5 years	5 years
Sovereign guarantee	Yes	No (DICGC up to ₹5L)
Rate (Q1 FY 2026-27)	7.5%	Varies (typically 6.5%–7.5%)
TDS	Not deducted	Deducted if interest >₹40K/yr

Tax treatment

Item	Rule
Interest earned	Taxable as ‘Income from Other Sources’
TDS	Not deducted by India Post on TD interest
Declaration	Self-declare in ITR annually or at maturity
80C deduction	Only for 5-year TD

Post Office FD vs Post Office MIS

Feature	Post Office FD	Post Office MIS
Interest payout	At maturity (compounded quarterly)	Monthly (simple interest)
Rate (5-year)	7.5% p.a.	7.4% p.a.
Cash flow	No interim payout	Monthly income
Good for	Wealth accumulation	Regular income
80C eligible	Yes (5-year only)	No
Max deposit	No limit	₹9L (single); ₹15L (joint)

Bridges

Post Office RD calculator — build a corpus via monthly recurring deposits
Post Office MIS calculator — monthly income scheme for lump sum investors
NSC calculator — 5-year National Savings Certificate: 80C-eligible at a higher 7.7% annual compound rate
Income tax calculator — estimate tax on your Post Office FD interest income

Frequently Asked Questions

What terms are available for Post Office Time Deposit?

Post Office Time Deposit (also called Post Office FD) is available in four tenures: 1 year (6.9% p.a.), 2 years (7.0% p.a.), 3 years (7.1% p.a.), and 5 years (7.5% p.a.). All rates are for Q1 FY 2026-27 and are subject to revision each quarter by the Government of India. Interest is compounded quarterly and paid at maturity.

Is the 5-year Post Office FD eligible for 80C deduction?

Yes. Only the 5-year Post Office Time Deposit qualifies for deduction under Section 80C of the Income Tax Act, 1961. The deduction is available up to ₹1,50,000 per financial year (combined with all other 80C investments). The 1-year, 2-year, and 3-year deposits are not eligible for 80C. The 5-year TD is similar to a 5-year bank tax-saver FD in this regard.

Can I withdraw a Post Office FD before maturity?

Premature withdrawal of a Post Office Time Deposit is permitted after 6 months from the deposit date. The interest rates on premature closure are: (1) withdrawal within 6 months — no interest, only principal returned; (2) withdrawal after 6 months but before 1 year — Post Office savings account rate (4% p.a.) applies; (3) withdrawal after 1 year — the applicable TD rate for the completed year, minus a 1% penalty. For example, closing a 3-year TD after 2 years earns the 2-year TD rate minus 1%.

Is Post Office FD interest taxable?

Yes. Interest on Post Office Time Deposits is fully taxable as 'Income from Other Sources' under the Income Tax Act, 1961. TDS is not deducted at source by India Post, so you must self-declare the interest income in your income tax return. The taxable interest can be declared on accrual basis or receipt basis. Most individuals declare on receipt basis (at maturity), but if switching to accrual basis is beneficial for tax planning, consult a tax advisor. Note: TDS on Post Office savings bank interest is deducted if the combined interest exceeds ₹10,000/year.

How does Post Office FD compare with bank FD?

Post Office FD has sovereign guarantee (Government of India), while bank FDs are insured only up to ₹5 lakh per depositor per bank by DICGC. Post Office FD rates are set centrally by the Government each quarter; bank FD rates vary by bank and can change more frequently. Post Office FD rates are competitive for mid-term tenures (1–3 years) and the 5-year rate (7.5%) beats most public sector bank FD rates. The 5-year Post Office FD (80C-eligible) competes directly with bank tax-saver FDs.

How does Post Office FD compare with Post Office MIS?

Post Office FD and MIS are both lump-sum products, but they serve different goals: FD is a growth instrument — interest compounds quarterly and is paid at maturity (no interim cash flow). MIS is an income instrument — interest is paid monthly (simple interest, no compounding on principal). If you need regular monthly income, choose MIS. If you want to grow a lump sum, choose FD. The 5-year FD rate (7.5%) is slightly higher than the MIS rate (7.4%), and FD also benefits from compounding while MIS does not.

Compliance disclaimer

Mutual fund investments are subject to market risks. Read all scheme related documents carefully before investing. Past performance is not indicative of future returns. The information on this page is for educational purposes only and does not constitute investment advice. Distribution by Jayesh Jain (AMFI ARN-286359). No advisory fees are charged.