Yes, it is added to your income and taxed at slab rate. There is no TDS, and no Section 80C benefit on the deposit.
Post Office MIS Calculator
See the fixed monthly income a Post Office Monthly Income Scheme deposit pays at the current 7.4% rate, the single and joint account limits, and how it compares with a bank FD payout or a mutual fund SWP for the same amount.
Monthly income
₹5,550.00
Yearly income
₹66,600
Total interest over 5 years
₹3,33,000
Principal returned at maturity
₹9,00,000
Same deposit, three income options (5 years)
| Option | Monthly income | Total income (5 yrs) | Principal at end | Tax treatment |
|---|---|---|---|---|
| Post Office MIS | ₹5,550 | ₹3,33,000 | ₹9,00,000 | Interest taxed at slab, no TDS |
| SBI 5-yr FD (6.05%) monthly payout | ₹4,538 | ₹2,72,280 | ₹9,00,000 | Interest taxed at slab, TDS above ₹50k |
| Hybrid fund SWP @ 8% (same withdrawal) | ₹5,550 | ₹3,33,000 | ₹9,30,346 | Only gains taxed |
POMIS rate 7.4% p.a. as notified for the quarter starting 2026-07-01. Rates are revised quarterly by the Government of India.
How the Post Office MIS Calculator works
POMIS pays simple interest every month on the deposit for 5 years and returns the principal at maturity. The monthly payout is fixed at the rate prevailing when you open the account — later rate changes do not affect it.
Limits: ₹9 lakh in a single account, ₹15 lakh in a joint account (across all POMIS accounts held). Premature closure is allowed after one year with a 2% penalty (1% after three years).
Monthly income = Deposit × Rate ÷ 12 ÷ 100
- Rate
- annual POMIS rate
Worked example
- Account type: Single (max ₹9 lakh)
- Deposit amount: ₹9,00,000
- POMIS interest rate: 7.4%
₹9 lakh at 7.4% pays ₹5,550 every month — ₹66,600 a year — and the ₹9 lakh comes back after 5 years.