₹50,000 in a fixed deposit for 1 year at 7% (interest added every quarter) becomes ₹53,593. The interest earned is ₹3,593.
Deposit
₹50,000
Tenure
1 year
At 6.5%
₹53,330
At 7%
₹53,593
At 7.5%
₹53,857
Post office time deposit (6.9%)
₹53,540
Tax on this interest
FD interest is added to your income and taxed at your slab rate. Banks deduct TDS when interest crosses the yearly limit; you can give Form 15G or 15H if your income is below the taxable limit.