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Calculate interest earned, after-tax return and effective annual rate for any Australian term deposit. Compare across terms and see the impact of your marginal tax rate.
An example figure: replace it with the rate your bank has actually offered for this term.
1yr
Term deposit interest is taxable income in the year it is received
| Term | Gross | After tax |
|---|---|---|
| $99 | $67 | |
| $297 | $202 | |
| $594 | $404 | |
| $1,188 | $808 | |
| $1,781 | $1,211 | |
| $2,375 | $1,615 | |
| $3,563 | $2,423 | |
| $5,938 | $4,038 |
1yr at 4.75% p.a.
Interest earned
$1,188
After-tax interest
$808
Final balance
$25,808
Effective rate
4.750%
+$85
$892 after tax
$808 after tax
-$85
$722 after tax
This calculator is not intended to be relied on for the purposes of making a decision in relation to a financial product. Before you make a financial decision, consider obtaining advice from someone who holds an Australian Financial Services Licence. We do not, and we cannot advise you.
A term deposit is a savings account where you lock in a fixed amount of money for a set period at a guaranteed interest rate. Unlike everyday savings accounts, the interest rate is fixed for the entire term, so you know exactly what you will earn.
Australian banks and credit unions offer term deposits from 1 month to 5 years. Rates are typically higher for longer terms and larger balances. Interest can be paid monthly, quarterly, semi-annually, annually or at the end of the term (at maturity).
Interest earned on a term deposit is taxable income. If you choose to receive interest before maturity (e.g. monthly), it is taxed in the year it is received. At-maturity interest is taxed in the year the term ends.
For at-maturity deposits: interest = principal × rate × (term in years). For example, $25,000 at 4.75% for 12 months = $1,187.50. For deposits with periodic payments, interest compounds at each payment date, so the effective annual rate is slightly higher than the stated rate.
Yes. Interest earned on a term deposit is taxable income and must be declared on your tax return. Your bank will report the interest to the ATO. The tax year in which you pay tax depends on when the interest is received: at maturity for at-maturity deposits, or in each year for periodic payments.
The Australian Government guarantees deposits up to $250,000 per person per Authorised Deposit-taking Institution (ADI). If you have more than $250,000 to deposit, consider splitting it across multiple banks to stay within the guarantee limit.
Longer terms usually (but not always) offer higher rates. However, you cannot access your money during the term without penalties. A popular strategy is laddering: spread your savings across several terms (e.g. 3, 6 and 12 months) so part of your money matures regularly and you can respond to rate changes.
When interest is paid monthly or quarterly, each payment is reinvested and starts earning its own interest: this is compounding. For a 12-month deposit, monthly compounding at 4.75% gives an effective annual rate of about 4.85% vs 4.75% at maturity. Use the 'Interest paid' dropdown in this calculator to see the difference.
Rates checked against the ATO, verified 8 September 2026
Estimates only. Not financial or tax advice. Full disclaimer for your rights and our limitations of liability.
Rates and thresholds last updated for the 2026–27 financial year.
This calculator exists to show you the arithmetic. It applies published Australian rates, thresholds and formulas to the numbers you enter and shows the working, so you can check it. That is all it does — it produces a number and describes what the number is. It does not recommend anything and it holds no opinion about any financial product.
What can move this result
This calculator is not intended to be relied on for the purposes of making a decision in relation to a financial product. Before you make a financial decision, consider obtaining advice from someone who holds an Australian Financial Services Licence. We do not, and we cannot advise you.