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How much TDS on my Indian FD is really mine to keep?
The bank deducts 30% on NRO deposit interest. Under the India-UAE treaty the rate is 12.5%. This shows the gap on one deposit.
= ₹15 Lakh
Difference between the bank's deduction and your treaty rate, per year
₹1,05,000 of interest: ₹32,760 deducted at the domestic rate against ₹13,125 at the treaty rate.
Visual comparison
This is one deposit. A CA works out the recovery across every NRO holding you have and gets the bank onto the treaty rate from now on.
What to do with this number
Get the treaty rate applied at source
A TRC and Form 41 (formerly Form 10F) given to the bank before the interest is credited, so the gap never leaves your account.
Recover what was already cut
Past years come back through your return, up to five with a late-filing waiver (condonation).
Should this money be in NRE instead?
NRE deposit interest is exempt in India while you are non-resident. Not every deposit belongs in NRO.
How this is worked out
- Domestic deduction: 30% under Section 195, plus surcharge for your income band and 4% cess, so 31.20% all-in for the band you picked.
- Treaty rate: 12.5% under the interest article of the India-UAE treaty, applied without surcharge or cess.
- Interest is deposit times rate for one year; a cumulative FD earns slightly more.
- NRE and FCNR (B) deposit interest is exempt while you are non-resident, so this applies to NRO deposits only.
Checked against the Income-tax Act and Rules on 10 September 2026. An estimate, not advice: your return decides.