Post Office Time Deposit Scheme 2026: Looking for a secure investment option that offers predictable returns without exposure to stock market fluctuations? The Post Office Time Deposit (TD) Scheme could be worth considering. Popularly known as the Post Office Fixed Deposit, this government-backed savings scheme allows individuals to invest a lump sum for a predetermined period and earn interest at the applicable rate.

As of November 2026, the scheme offers annual interest rates ranging from 6.9% to 7.5%, depending on the investment duration. Investors can choose from four maturity options: one year, two years, three years, and five years.

For someone investing ₹1 lakh, the estimated total interest over five years can reach approximately ₹44,995 at an annual interest rate of 7.5%, based on the calculation presented in the original report.

However, the actual maturity proceeds depend on the scheme's interest calculation and annual payout rules. Here is a detailed explanation of the available deposit options, expected earnings, tax benefits, and important conditions.

Post Office FD Interest Rates in November 2026

The Post Office Time Deposit Scheme offers different interest rates depending on how long the money remains invested.

The following rates apply to the four available deposit periods:

The five-year deposit currently offers the highest interest rate among these options.

An important feature of the Post Office TD Scheme is that interest is calculated quarterly but payable annually. This differs from a conventional cumulative bank FD, where interest may remain invested and compound until maturity.

Consequently, investors should distinguish between total interest earned over the deposit period and the amount actually payable at maturity.

Post Office FD Calculator: Returns on ₹1 Lakh Investment

Suppose an individual deposits ₹1,00,000 in a Post Office Time Deposit account.

The estimated interest income will vary according to the chosen investment duration and the applicable interest rate.

Post Office FD Interest Calculator

Deposit amount (₹)

Deposit duration

1 Year — 6.90%

2 Years — 7.00%

3 Years — 7.10%

5 Years — 7.50%

Estimated total interest

₹38,568

Principal + total interest

₹1,38,568

Illustrative pre-tax calculation using quarterly compounding for annual interest payments. Interest is payable annually, so the second figure is not necessarily the amount paid on maturity.

How Much Interest Can ₹1 Lakh Earn in 1, 2, 3 and 5 Years?

The following calculations illustrate the interest available on a ₹1 lakh investment under different deposit periods.

1-Year Post Office FD: Earn Around ₹7,081

For a one-year deposit, the applicable annual interest rate is 6.9%.

On an investment of ₹1 lakh, the estimated interest comes to approximately ₹7,081.

The total amount, including the original investment, would be around ₹1,07,081.

This option may suit investors who want to preserve their capital while keeping the investment period relatively short.

2-Year Post Office FD: Interest of Approximately ₹14,888

Investors choosing the two-year Time Deposit receive an annual interest rate of 7%.

Based on the illustration in the source report, a ₹1 lakh deposit can generate approximately ₹14,888 in total interest over two years.

The combined value of the principal and interest would therefore be approximately ₹1,14,888.

However, interest is payable annually rather than automatically reinvested for the entire period.

3-Year Post Office FD: Total Earnings of Around ₹23,508

The three-year deposit offers an annual interest rate of 7.1%.

According to the original illustration, an investment of ₹1 lakh can generate approximately ₹23,508 in interest during the three-year period.

This represents a combined principal and interest value of around ₹1,23,508.

The three-year option may appeal to investors who can set aside money for a medium-term financial goal.

5-Year Post Office FD: Earn Nearly ₹45,000

The five-year Time Deposit carries the highest interest rate among the four available options, at 7.5% annually.

A ₹1 lakh investment can generate approximately ₹44,995 in total interest over five years, according to the source's illustrative figures.

The combined value of the original deposit and total interest would be approximately ₹1,44,995.

The five-year option also offers an additional tax-related advantage for eligible taxpayers.

Post Office FD Returns: ₹1 Lakh Investment Comparison

Note: These are the approximate figures provided in the source article. Actual Post Office TD interest is calculated quarterly and payable annually. The figures should not be interpreted as guaranteed lump-sum maturity payouts. Investors should obtain an official calculation before depositing funds.

Is the Post Office Time Deposit Scheme Safe?

Post Office Time Deposits are part of India's government-backed small savings framework.

Unlike equity investments, their returns are not linked to daily stock market movements.

The applicable interest rate is fixed for the deposit's term when the account is opened, subject to the scheme's rules.

This makes the scheme attractive to individuals who prefer predictable interest income and capital protection.

However, investors should consider inflation, taxation, and liquidity requirements before choosing a long-term deposit.

Tax Benefits on 5-Year Post Office FD

One of the important features of the five-year Post Office Time Deposit is its eligibility for tax deductions under Section 80C of the Income Tax Act, subject to applicable conditions.

Eligible taxpayers using the old income tax regime can claim deductions of up to ₹1.5 lakh annually across qualifying Section 80C investments.

However, there are important distinctions:

• The Section 80C deduction applies to eligible five-year deposits, not automatically to shorter Time Deposit accounts.

• The benefit is generally unavailable under the new income tax regime.

• Interest earned on Post Office Time Deposits is taxable according to the investor's applicable income tax provisions.

• The ₹1.5 lakh deduction limit is shared with other qualifying investments and payments under Section 80C.

Therefore, the scheme should not be described as completely tax-free.

Can You Extend Your Post Office FD After Maturity?

Investors may extend their Time Deposit accounts after the original term ends, provided they follow the prescribed rules and deadlines.

The extension windows mentioned in the source are:

Account holders may need to submit the required application and account documents to the post office.

The interest rate applicable to the extended deposit generally depends on the rate prescribed for the relevant term on the original maturity date, subject to official scheme provisions.

Investors should verify the current extension process with India Post before the account matures.

Which Post Office FD Duration Should You Choose?

Choosing a deposit period depends on when the money may be needed.

A one-year deposit may be suitable for someone with a near-term savings objective, while a two-year or three-year deposit offers a longer investment horizon.

The five-year deposit provides the highest stated interest rate and may offer Section 80C benefits to eligible taxpayers under the old tax regime.

However, a higher interest rate does not automatically make a longer deposit the right choice for everyone.

Investors should consider their emergency savings, upcoming expenses, tax situation, and the restrictions applicable to premature withdrawals.

Important Things to Check Before Investing

Before opening a Post Office Time Deposit account, investors should verify the latest interest rates, minimum deposit requirements, premature closure conditions, and annual interest payment arrangements.

They should also compare the scheme with bank fixed deposits and other government-backed savings products according to their financial needs.

The interest rates on new Post Office Time Deposits can be revised periodically by the government. Rates applicable to an existing deposit are generally retained for its original term.

Final Takeaway

The Post Office Time Deposit Scheme offers a government-backed investment option for individuals seeking predictable interest earnings.

At the stated November 2026 rates, a ₹1 lakh deposit can generate approximately ₹7,081 in interest over one year, while the five-year option can provide total interest of around ₹44,995, based on the source's illustrative calculation.

The five-year Post Office TD offers a 7.5% annual interest rate, but investors must remember that interest is payable annually and should not confuse total interest earnings with the maturity payment.

Before investing, check the latest official India Post rules and select a deposit period that matches your financial requirements.

Disclaimer: This article is intended for general financial information. Returns are illustrative and subject to applicable rates, calculation rules, and taxes. Verify the latest details with India Post before investing.