NSC Calculator
Enter your deposit to see what a National Savings Certificate is worth after five years, the interest credited each year, and what you can claim under Section 80C.
What the National Savings Certificate actually is
The National Savings Certificate is a five-year fixed-return deposit sold at any post office, backed by the Government of India. You put money in once, nothing happens for five years, and at the end you get your deposit plus every rupee of compounded interest in a single payment.
Two things make it worth a look: the capital carries a sovereign guarantee rather than the ₹5 lakh deposit insurance that covers bank FDs, and the deposit qualifies for a Section 80C deduction. There is no maximum investment, though only ₹1,50,000 a year earns the tax break.
How the maturity value is calculated
NSC compounds annually and pays nothing out along the way:
maturity = deposit × (1 + rate)⁵
At the current 7.7%, that is a multiple of 1.4490. India Post publishes the same figure in the form most people see it: a deposit of ₹1,000 fetches ₹1,449.03 after five years. So ₹1,00,000 becomes ₹1,44,903, and ₹1,50,000 — the 80C ceiling — becomes ₹2,17,355.
What a deposit grows to at 7.7%
| Deposit | Maturity after 5 years | Interest earned |
|---|---|---|
| ₹10,000 | ₹14,490 | ₹4,490 |
| ₹50,000 | ₹72,452 | ₹22,452 |
| ₹1,00,000 | ₹1,44,903 | ₹44,903 |
| ₹1,50,000 (80C ceiling) | ₹2,17,355 | ₹67,355 |
| ₹5,00,000 | ₹7,24,517 | ₹2,24,517 |
The 80C claim almost every NSC calculator ignores
Most NSC calculators stop at the maturity figure and mention that the deposit qualifies for 80C. That misses the more valuable half of the deal.
NSC interest is taxable at your slab — but because it is reinvested inside the certificate rather than paid to you, the interest accrued in years one to four is treated as a fresh NSC investment in each of those years, and it qualifies for Section 80C all over again. In practice the tax on those four years cancels itself out.
Only the fifth year's interest has nowhere to be reinvested, because the certificate matures. That year is genuinely taxable.
On a ₹1,00,000 certificate the difference is concrete. Total interest is ₹44,903. Taxed naively at 30% that is ₹13,471 of tax. Claim the reinvestment properly and only year five's ₹10,360 is taxable — about ₹3,108. The calculator above shows the year-five figure separately for exactly this reason.
NSC or a five-year tax-saver FD?
These two compete for the same money and the same 80C slot, and both lock up for five years.
| NSC | 5-year tax-saver FD | |
|---|---|---|
| Backing | Government of India | DICGC insurance, ₹5 lakh per bank |
| Rate | 7.7%, set quarterly | Varies by bank, typically 6.5–7.5% |
| TDS | None deducted | Deducted above ₹40,000 interest (₹50,000 for seniors) |
| Interest 80C reinvestment | Yes, years 1–4 | No |
| Loan against it | Accepted as collateral by banks | Usually not on tax-saver FDs |
The absence of TDS is a genuine cash-flow advantage rather than a tax saving — you still owe the tax, you just are not out of pocket before you file. Compare against your own bank's rate in the FD calculator before deciding.
NSC or PPF?
PPF pays slightly less (7.1%) but its interest is completely tax-free, and NSC's is not. Over PPF's fifteen-year lock-in that tax exemption comfortably outweighs NSC's higher headline rate for anyone in the 20% or 30% slab.
The honest split: NSC suits a five-year horizon and PPF a fifteen-year one. They are not really substitutes, and the deciding factor is when you need the money rather than which rate looks better. The PPF calculator runs the longer horizon.
Rules that catch people out
- No premature withdrawal except on the holder's death, forfeiture by a pledgee, or a court order. Treat the five years as genuinely locked.
- No TDS, but the tax is still owed. India Post deducts nothing, which leads people to assume the interest is exempt. Declare it under "Income from Other Sources" each year as it accrues.
- Rates are fixed at purchase. A quarterly revision does not change a certificate you already hold — your 7.7% is locked for the full five years, which cuts both ways.
- Accounts for minors are allowed, and certificates can be transferred once from one holder to another.
- Accrued interest must be declared annually to support the 80C reinvestment claim. Declaring the whole amount only in year five forfeits the benefit.
Who NSC actually suits
It fits a conservative saver with old-regime 80C headroom who does not need this money for five years and wants sovereign backing rather than bank-deposit insurance. It fits particularly well for someone whose 80C bucket is not already full from EPF, because the reinvestment claim then does real work.
It does not suit anyone on the new tax regime — with no 80C, NSC is just a fully taxable five-year deposit competing on rate alone, and at that point compare it against every FD you can find. It also does not suit anyone who needs an income stream: for that, POMIS pays monthly, and a systematic withdrawal plan covers the market-linked version of the same need.
Frequently Asked Questions
What is the current NSC interest rate?
How much will ₹1 lakh become in NSC?
Is NSC interest taxable?
Does NSC deduct TDS?
Can I withdraw NSC before five years?
Is there a maximum NSC investment?
Is NSC better than a tax-saving FD?
Does NSC still make sense under the new tax regime?
Sources
Every statutory figure on this page is taken from the primary source below. Rates and thresholds change by notification — if you are filing, check the source for the current position.
- National Savings Institute, Ministry of Finance — quarterly small-savings interest rates
- Income Tax Department, Government of India — slab rates and Section 87A rebate