₹50,000 in a fixed deposit for 10 years at 7% (interest added every quarter) becomes ₹1,00,080. The interest earned is ₹50,080.
Deposit
₹50,000
Tenure
10 years
At 6.5%
₹95,278
At 7%
₹1,00,080
At 7.5%
₹1,05,117
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.