Calculate fd income(cumulative)

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How do I calculate Income from FD with interest paid on maturity(Cumulative Interest) having around 8 years maturity period and report Income from this FD annually in ITR?
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Compound interest arises when interest  is added to the principal so that from that moment on, the interest that has been added also itself earns interest. This addition of interest to the principal is called compounding. 

The following formula gives you the total amount one will get if compounding is done:-

 

A = P \left(1 + \frac{r}{n}\right)^{nt}

 

Where,

  • A = Final Amount that will be received
  • P = Principal Amount (i.e. initial investment)
  • r =  Annual nominal interest rate (as a decimal i.e. if interest is paid at 5.5% pa, then it will be 0.055) (it should not be in percentage)
  • n = number of times the interest is compounded per year (i.e. for monthly compounding n will be 12, for half year compounding it will be 2 and for quarter it will be 4
  • t = number of years

[To arrive at the interest amount you can further use the formula Interest = A - P ]

 

If You still in confusion than give me below four info.. I ll tell you the maturity amount and effective yield rate.

PRINCIPAL AMOUNT

PERIOD OF FIXED DEPOSIT IN YEARS

RATE OF INTEREST

FREQUENCY OF COMPOUNDING

Is it possible for me to get Statement from Bank regarding the Interest Distributed for my FD's during the financial Year? Is this statement available online from Traces website or the bank's website?

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