NRO FD Rates Hit 6.75%: What's Left After Tax?
Major Indian banks are offering up to 6.75% interest on NRO fixed deposits in 2026. But NRIs must know that heavy TDS and currency risk can eat into real returns. Here's how to make the most of your Indian income parked in India.
TDS on NRO FDs is 30% — that 6.75% rate quietly becomes ~4.7% in hand.
Your NRO fixed deposit can earn this much — but tax will cut it sharply
Key Takeaways
Check if your country of residence has a Double Taxation Avoidance Agreement (DTAA) with India — it can reduce TDS from 30% to as low as 10–15%.
Submit Form 10F and a Tax Residency Certificate to your bank before booking the FD, so reduced DTAA TDS is applied from day one — not after the fact.
Compare NRO FD rates across at least 3–4 banks including smaller private and public sector banks, as rates vary by tenure and some offer promotional rates on specific slabs.
Major Indian banks are offering up to 6.75% interest on NRO fixed deposits in 2026. But NRIs must know that heavy TDS and currency risk can eat into real returns. Here's how to make the most of your Indian income parked in India.
Here's what happened: Top Indian banks including SBI, HDFC, ICICI, PNB, and Axis are offering NRO FD rates ranging from 6.5% to 6.75% on deposits up to ₹3 crore in 2026.. NRO fixed deposits are meant for NRIs to park India-sourced income like rent, dividends, or pension — money that cannot be freely repatriated without limits.. Interest earned on NRO FDs attracts a flat 30% TDS plus surcharge and cess under Indian tax law, unless a DTAA with the NRI's country of residence lowers the rate..
What you should do: Check if your country of residence has a Double Taxation Avoidance Agreement (DTAA) with India — it can reduce TDS from 30% to as low as 10–15%.. Submit Form 10F and a Tax Residency Certificate to your bank before booking the FD, so reduced DTAA TDS is applied from day one — not after the fact.. Compare NRO FD rates across at least 3–4 banks including smaller private and public sector banks, as rates vary by tenure and some offer promotional rates on specific slabs..
NRO FD interest is taxable in India, but you can claim a foreign tax credit in your country of residence for TDS already deducted — avoiding double taxation entirely if you file correctly.
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- [1]“NRO FD interest rates 2026: SBI, HDFC, PNB, ICICI, Axis offer up to 6.75% rate on deposits up to Rs 3 crore” Wealth-Economic Times · 21 Jul 2026
This article is reported by GoCredit's Editorial Team based on the source above. GoCredit synthesises, contextualises, and adds India-borrower-relevant analysis. We are not the original publisher.