Bank FD rates in October 2026: How pre- and post-tax fixed deposit returns differ across HDFC, ICICI, SBI and PNB

Fixed deposits offer predictable returns, but taxes can reduce the interest you retain. A latest report compares FD rates across large banks and tenures. Here’s how to understand pre-tax and post-tax returns, FD taxation rules, and what a ₹5 lakh deposit could earn.

Fixed deposits (FDs) offer predictable returns, but the interest earned is taxable as per the depositor’s applicable income tax slab. Therefore, investors should compare both pre-tax and post-tax returns before choosing a bank or deposit tenure.

According to FundsIndia’s October 2026 report, FD interest rates across large banks vary by tenure, affecting the returns investors retain after tax. Here’s what depositors need to know.

How is FD interest taxed in India?

Interest earned on bank FDs is taxable under “Income from Other Sources” and added to the depositor’s taxable income. The applicable income tax slab determines the final tax liability.

Banks may deduct tax at source (TDS) when interest exceeds the applicable threshold. For bank deposits, the threshold is ₹50,000 in a financial year for non-senior citizens and ₹1 lakh for senior citizens. TDS is generally deducted at 10% when the depositor’s PAN is furnished.

However, TDS is not the final tax liability. Depositors may have to pay additional tax or may be eligible for a refund when filing their income tax return (ITR), depending on their actual tax liability.

What are the FD rates pre- and post-tax across large banks?