Recurring Deposit (RD) Calculator - Calculate RD Maturity
Compute your RD maturity value, cumulative interest, and CAGR based on Indian Post Office and commercial bank quarterly compounding guidelines.
Calculation Summary
Total Deposits Made
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Interest Earned
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Total Maturity Value
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Effective CAGR
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Post Office RD (6.70%) vs Top 5 PSU Bank RD (SBI, PNB, BoB, Canara, Union)
Compare 5-year statutory Post Office Recurring Deposit returns against India's leading Public Sector Banks. Evaluates sovereign zero default risk, Section 194A 0% TDS exemption at source, and senior citizen rate bonuses.
Recurring Deposit (RD) Annual Tax Drag vs Broad Equity SIP (12% CAGR)
Evaluate the wealth penalty of investing monthly in a Bank Recurring Deposit (taxed annually at slab rates up to 31.2%) versus a Broad Equity Index SIP (compounding tax-deferred with first ₹1.25L capital gains tax-free under Section 112A).
Visualizations
Maturity Composition
Corpus Growth Over Time
Yearly Interest Earned
Cumulative Deposit vs Accumulation
Annual Accumulation Schedule
How Recurring Deposit (RD) Compounding Works in India
A Recurring Deposit (RD) is a disciplined fixed-income savings tool offered by all scheduled commercial banks and the Department of Posts (India Post). Unlike a Fixed Deposit (FD) which demands a single upfront lump sum, an RD allows salaried savers to deposit a fixed installment every calendar month for a tenure ranging from 6 months to 10 years, earning fixed guaranteed returns.
Quarterly Compounding Formula
Indian banks and India Post compound RD interest every quarter (4 times per year) using the standard formula:
Every monthly installment earns interest for the exact number of calendar quarters it remains invested before the maturity date, generating substantial compound interest over 3 to 5 years.
TDS & Taxation (Section 80TTB)
Tax rules governing RD returns across standard and senior investors:
- Tax Deducted at Source (TDS): Under Section 194A, banks deduct 10% TDS if annual cumulative interest across all deposits exceeds ₹40,000 for regular individuals (₹50,000 for seniors).
- Senior Citizen Exemption: Under Section 80TTB, senior citizens (age ≥ 60) can claim up to ₹50,000 interest income tax-free every financial year.
- Tax Slabs: Net interest is added to total income and taxed at marginal income tax slab rates.
Post Office RD vs Bank RD Comparison
The 5-Year National Savings Recurring Deposit (Post Office RD) offers a government-backed sovereign return of 6.70% p.a. (quarterly compounded). Leading commercial banks like SBI offer 6.80% to 7.00% for 1 to 5 years, with an extra +0.50% statutory premium for senior citizens (e.g. 7.50% at SBI/HDFC and up to 9.00% at Small Finance Banks). Post Office deposits carry zero credit risk and are backed by the Sovereign Guarantee of the Government of India.
For comparing guaranteed fixed-income returns with sovereign EEE tax exemption vehicles, read our in-depth research guide on PPF vs Fixed Deposit & RD: Real Post-Tax Yield Comparison (2026) →
Frequently Asked Questions
How is interest calculated on an RD account?
Interest on Recurring Deposits in Indian banks and Post Offices is calculated on a quarterly compounding basis. The installment paid in month 1 earns interest for all quarters until maturity, the installment in month 2 earns interest for one month less, and so on.
Do senior citizens get higher interest rates on Recurring Deposits?
Yes, most Indian commercial banks provide an additional 0.50% (50 basis points) interest rate premium to senior citizens (individuals aged 60 and above) across all RD tenures.
Is TDS deducted on Recurring Deposit interest?
Yes, under Section 194A of the Income Tax Act, banks deduct 10% TDS if the total interest earned across FDs and RDs in a financial year exceeds ₹40,000 for regular depositors or ₹50,000 for senior citizens. Depositors with total taxable income below the exemption limit can submit Form 15G or 15H to prevent TDS deduction.
Can I prematurely withdraw or break an RD account?
Yes, banks permit premature closure of RD accounts, typically subject to a penalty of 0.5% to 1.0% deducted from the applicable interest rate for the period the deposit was actually held. Post Office RDs can be closed prematurely only after 3 years from the date of opening.