Post Office FD in India 

A Post Office Fixed Deposit is a savings scheme offered by India Post through various post offices spread across the country. Since India Post is a Government of India initiative, there’s absolutely zero investment risk involved. Post Office Fixed Deposit Interest rates are usually higher than what most scheduled banks offer. Hence, this makes it a great investment option for investors looking for stable returns with the least amount of risk involved.

Post Office Fixed Deposit Calculator

You can now instantly calculate your returns on investments using the Post Office FD Calculator .

 Post Office FD Interest Rate  

 FD Interest rates in Post Office start at 5.5% per annum and go all the way up to Rs. 6.7% per annum, depending on the tenor that you opt for. The accumulated interest is calculated on a quarterly basis, but is only paid out annually.  

The following table will give you a clearer idea on FD Interest Rates in Post Office as per different tenors:

Note: The Post Office FD interest rate specified above are applicable from 01.07.2022 onwards.

Features and Benefits of the Post Office Fixed Deposit Scheme

The Post Office Fixed Deposit Scheme includes the following features and benefits:

Eligibility Criteria to Open a Post Office Fixed Deposit

If you’re looking to invest in a Post Office Fixed Deposit , here’s a quick look at who can open an FD in Post Office :

• A single adult individual (for single account)

• Up to three adults (for joint account) 

• A guardian on behalf of a minor or a person of unsound mind 

• A minor over the age of 10 

Post Office Fixed Deposit VS Bajaj Finance Fixed Deposit

Bajaj Finance is a NBFC that also offers fixed deposit schemes to individuals.

Here’s a short comparison between the Post Office Fixed Deposit scheme and the Bajaj Finance Fixed Deposit scheme:

Post Office FD Interest Rate  and Interest Earned for Different Tenors 

Post Office FD interest rate varies depending on the tenor that you choose . FD rates in Post Office range from 5.5% p.a. to 6.7% p.a based on the tenor. 

Here’s an example to help you understand how much interest you’re likely to earn for different tenors on an investment amount of Rs. 1,00,000. 

The FD rates in Post Office specified above are applicable from 01.07.2022 onwards. 

Post Office FD Interest Rates and Interest Earned for Different Tenors - Senior Citizens

Post Office FD interest rates are the same for both non-senior citizens and senior citizens. There’s no additional interest rate benefit offered. 

How is the Post Office FD Maturity Amount Calculated?

Although you can use a Post Office FD Calculator to arrive at the final maturity amount, it is still good to know how it is calculated.

Here’s the formula that’s used to arrive at the maturity amount of the FD:

Here, ‘n’ represents the tenor. 

Let’s apply this formula to calculate the maturity amount that you’re likely to end up with on an investment of Rs. 1,00,000 at the end of a tenor of 5 years. The Post Office FD interest rate on a tenor of 5 years is currently 6.7%. 

Maturity Value = Rs. 1,00,000 * (1 + 0.067 ÷ 4)(5 * 4)

Maturity Value = Rs. 1,38,300

At the end of the 5-year tenor, you stand to receive Rs. 1,38,300  in return for your investment amount of Rs. 1,00,000. 

How to Open an FD in Post Office

To open an FD in Post Office , you would have to physically visit a post office branch nearest to you and follow the steps listed below:

1. Request for Form 1, which is the application form to open an FD in Post Office .

2. Fill the application form and affix your photograph and signature in the respective fields. 

3. Submit the duly filled Form 1 along with all the documents required to open an FD in Post Office . 

4. Your Post Office Fixed Deposit  will be opened within a few days from the submission of Form 1 and you will be notified via SMS on your mobile. 

Documents Required to Open an FD in Post Office

To open an FD in Post Office , here’s a list of the documents required along with the application form:

• Identity Proof - PAN, Aadhaar, Voter ID, or Passport

• Address Proof - Aadhaar, Passport, driving license, or utility bills

• 2 passport size photographs 

Different Types of Post Office Tax Saving Schemes

In addition to the FD facility, India Post offers several other tax saving schemes as well. Some of them are as follows:

• Senior Citizens Savings Scheme (SCSS)

• Sukanya Samriddhi Account

• National Savings Certificate (NSC)

• Public Provident Fund (PPF)

TDS on Post Office Fixed Deposit

• TDS is a mechanism through which the paying entity deducts taxes from your income and pays it to the Income Tax Authorities on your behalf. 

• In case of an FD in Post Office, India Post deducts a percentage of the accumulated interest and pays it on your behalf to the Income Tax Authorities. 

• TDS on FD is only applicable if the interest generated during a year exceeds Rs. 40,000 (for non-senior citizens) and Rs. 50,000 (for senior citizens).

• India Post currently deducts a 10% TDS on FDs, provided you disclose your PAN details. In the case of non-disclosure of PAN details, a 20% TDS will be deducted. In case of non-resident Indians, a 30% TDS plus surcharges and cesses are applicable. 

• If your total taxable income is less than Rs. 2.5 Lakh, you can seek a waiver of TDS by submitting Form 15G with India Post.