If one wants a bank FD at 10 per cent return for five years. He/She pays income tax. What will be the returns?
The post-tax return has to be calculated here. The idea is to know the final returns on a fully taxable income. Interest income from the bank is taxed as per your tax slab.
Formula: ROI / (ROI * TR)=Post-tax return
Type in: =10 / (10 * 30.9%) and hit enter. You will get 6.91%
ROI: rate of interest;
TR: tax rate (depends on tax slab)
Also used for: Calculating post-tax returns of national savings certificates, post-office time deposits, and Senior Citizens' Savings Scheme.
The post-tax return has to be calculated here. The idea is to know the final returns on a fully taxable income. Interest income from the bank is taxed as per your tax slab.
Formula: ROI / (ROI * TR)=Post-tax return
Type in: =10 / (10 * 30.9%) and hit enter. You will get 6.91%
ROI: rate of interest;
TR: tax rate (depends on tax slab)
Also used for: Calculating post-tax returns of national savings certificates, post-office time deposits, and Senior Citizens' Savings Scheme.
