Summary: Kotak Mahindra Bank Limited’s published domestic/NRO/NRE callable fixed-deposit table, checked on 21 October 2026 and shown for the rate schedule effective from 23 September 2026, lists 6.35% per annum for the 365-days-to-less-than-15-months bucket and 6.85% for resident senior citizens. The product permits premature withdrawal subject to the bank’s applicable-rate comparison and a 1% penal charge for an actual stay of 365 days or more; a shorter actual stay can fall into another penalty slab. Deposit insurance is limited to ₹5 lakh for principal and interest aggregated in the same right and capacity across the insured bank. Interest remains taxable, and withholding is only a tax-credit mechanism, not the final tax liability.
- Product identity and the verified 365-day rate bucket
- Who can use the quoted senior-citizen rate
- Interest payout and maturity value are not the same thing
- Cumulative option
- Periodic payout option
- Booking-date evidence
- Premature closure: actual stay controls the recalculation
- DICGC insurance: ₹5 lakh is an aggregate ceiling, not a per-FD promise
- Income tax and TDS for Tax Year 2026-27
- Before booking: a neutral document check
- Frequently Asked Questions on this Kotak fixed deposit
- 1. What rate was verified for 365 days to less than 15 months?
- 2. Does a senior citizen receive 6.85% on an NRO or NRE deposit?
- 3. Is the premature-closure penalty always 1%?
- 4. Does DICGC cover ₹5 lakh principal plus another ₹5 lakh interest?
- 5. Is TDS the final income tax on FD interest?
- 6. Does Form 15G or Form 15H make the interest tax-free?
- Key Takeaways
- Source Links
Product identity and the verified 365-day rate bucket
This article covers one specific bank product: Kotak Mahindra Bank Limited’s domestic callable fixed deposit, with premature withdrawal allowed, for a contracted tenure from 365 days to less than 15 months. It is not the bank’s tax-saving deposit, non-withdrawable deposit, ActivMoney sweep balance, recurring deposit, NRE deposit or NRO deposit. The distinction matters because payout options, senior-citizen benefit, premature closure and tax treatment can differ across those products.
The bank’s official interest-rate page was checked on 21 October 2026. Its schedule effective from 23 September 2026 lists 6.35% per annum for the 365-days-to-less-than-15-months bucket for regular domestic depositors and 6.85% per annum for resident senior citizens. Rates apply to the bank’s stated deposit categories and amounts and can change for new bookings. The contractual rate for an existing deposit is evidenced by the advice generated at booking, subject to the deposit terms and any premature closure.
| Verified item | Position for the covered deposit | Check before booking |
|---|---|---|
| Bank | Kotak Mahindra Bank Limited | Exact legal name on deposit advice |
| Product | Callable fixed deposit; premature withdrawal allowed | Do not select non-withdrawable or sweep variant |
| Contracted tenure | 365 days to less than 15 months | Exact maturity date |
| Regular domestic rate | 6.35% p.a. | Live rate table and booking screen |
| Resident senior-citizen rate | 6.85% p.a. | Eligibility and customer category |
| Rate schedule | Effective 23 September 2026; checked 21 October 2026 | Any later revision before funding |
Who can use the quoted senior-citizen rate
The extra rate in the quoted column is for eligible resident senior citizens. The bank’s official page states that the senior-citizen rate is not applicable to NRO or NRE deposits and that ActivMoney uses regular fixed-deposit rates for all customers. A depositor should therefore confirm residency, age, customer category and product code rather than infer the rate from age alone. Joint deposits should be checked against the bank’s operating and eligibility rules, including which holder’s status controls the rate.
The bank states that a fixed deposit can start from ₹5,000 and that acceptance of deposits of ₹5 crore and above is at its discretion. This guide does not assume that every channel offers every tenure, payout combination or nomination facility at every moment. Branch, net-banking and mobile interfaces may display only the options available to that customer profile. The final advice and terms should be downloaded immediately after booking.
Interest payout and maturity value are not the same thing
Cumulative option
Under a cumulative option, interest is added according to the bank’s compounding method and paid with principal at maturity. The effective maturity amount will not equal principal multiplied by the headline rate in every case because tenure, compounding dates, day count and tax deduction affect the cash flow. The bank says its calculation uses 365 days in a non-leap year and 366 days in a leap year.
Periodic payout option
A depositor choosing monthly or quarterly interest receives cash during the tenure instead of compounding the full amount to maturity. The bank notes that monthly interest for a period shorter than a quarter is paid at a discounted rate as directed. Therefore, multiplying the nominal annual rate by one-twelfth may not reproduce the actual monthly credit. Compare the official illustration or deposit advice for the chosen payout frequency.
Booking-date evidence
Preserve the booking confirmation showing principal, tenure, rate, maturity date, payout instruction, nomination, account ownership and lien status. A screenshot of a public rate page does not prove the contractual terms of an individual deposit. Where money is moved from a joint account or held for a minor, trust, firm or company, the title and capacity should be consistent across KYC, mandate and accounting records.
Premature closure: actual stay controls the recalculation
Kotak states that on premature closure it pays the lower of the contracted rate and the rate that prevailed on the original booking date for the period the deposit actually remained with the bank, after deducting the applicable penal charge. This means the original 365-days-to-under-15-months rate does not simply continue on a broken deposit. The relevant comparison uses the actual completed tenure and the rate card that applied when the deposit was opened.
| Actual period deposit remained | Published penal charge for deposits booked/renewed from 20 May 2022 |
|---|---|
| Up to 180 days | Nil |
| More than 180 days and up to 364 days | 0.50% |
| 365 days or more | 1.00% |
For example, a deposit originally booked for 400 days but closed after 300 days enters the bank’s 181-to-364-day penalty slab, not the 365-day slab, and the base comparison rate is the rate applicable on the booking date for 300 days. The example explains the mechanism only; it does not calculate a return because the historical 300-day rate and exact day count must be read from the applicable card. A lien, sweep linkage or part withdrawal can also affect the transaction and should be checked before placing funds.
DICGC insurance: ₹5 lakh is an aggregate ceiling, not a per-FD promise
The DICGC insured-bank list, updated on 29 September 2026, includes Kotak Mahindra Bank Ltd. DICGC covers eligible deposits with an insured bank, including fixed deposits, up to ₹5 lakh for principal and accrued interest together in the same right and same capacity. Deposits held through different branches of the same bank in the same ownership capacity are aggregated. Opening several fixed deposits or using several branches does not multiply the ceiling.
Different legal capacities may be treated separately under the scheme, but labels should not be manipulated to create artificial capacity. The DICGC guide explains joint, individual, trustee, guardian and other capacities through its own rules. Insurance is a statutory protection that operates on specified events; it is not a guarantee of uninterrupted access, market liquidity, every type of claim, or amounts above the ceiling. The depositor should verify the bank’s continuing insured status and the latest DICGC rules.
| Deposit position at one insured bank | DICGC aggregation principle |
|---|---|
| Savings account plus several FDs in one individual’s name | Aggregate principal and interest in the same right/capacity; ceiling ₹5 lakh |
| Accounts at different branches of the same bank | Aggregate across branches |
| Eligible deposits at two different insured banks | Ceiling applies separately to each bank |
| Principal already ₹5 lakh | Accrued interest above the ceiling is not additionally insured |
Income tax and TDS for Tax Year 2026-27
Interest arising during Tax Year 2026-27 falls under the Income-tax Act, 2025, which commenced on 1 April 2026. Bank-deposit interest is generally taxable under income from other sources unless it is properly attributable to a business and accounted for under the applicable business-income rules. Tax follows accrual or receipt according to the taxpayer’s permissible method and facts; it is not deferred merely because the deposit is cumulative or has not matured.
The Income Tax Department’s transition FAQ states that post-1-April-2026 withholding obligations use the new Act and that TDS categories are consolidated in section 393, while rates and monetary thresholds were retained. Kotak’s public disclosure still describes its operational withholding by reference to legacy section 194A; depositors preparing Tax Year 2026-27 records should use the current statutory mapping and portal forms. TDS deducted by the bank is a credit against final tax, not a separate or final tax on the interest.
Eligible residents may submit the prescribed declaration for non-deduction only when all statutory conditions are satisfied; Form 15G or Form 15H is not a general exemption from tax. PAN, residential status, estimated total income and declaration validity should be checked. Reconcile interest certificates, account statements and the current annual-information statement or successor reporting form. If total estimated tax crosses the advance-tax threshold, deposit interest can affect instalments even when TDS has been deducted.
Before booking: a neutral document check
- Match the product code to a callable domestic FD and the 365-days-to-less-than-15-months bucket.
- Confirm the live rate, customer category, payout option and maturity date on the booking screen.
- Read premature-closure and partial-withdrawal terms, including the actual-tenure rate comparison.
- Aggregate balances and accrued interest across Kotak branches and accounts for DICGC analysis.
- Keep PAN, nomination, ownership capacity and bank mandate current.
- Plan tax cash flow using gross interest, TDS credit and applicable advance-tax rules.
Frequently Asked Questions on this Kotak fixed deposit
1. What rate was verified for 365 days to less than 15 months?
The official schedule checked on 21 October 2026 lists 6.35% p.a. for regular domestic depositors and 6.85% p.a. for eligible resident senior citizens, under the schedule effective from 23 September 2026.
2. Does a senior citizen receive 6.85% on an NRO or NRE deposit?
No. The bank states that the senior-citizen rate does not apply to NRO or NRE deposits. This article covers the domestic callable product.
3. Is the premature-closure penalty always 1%?
No. The published slab depends on the actual period the deposit stayed with the bank. The bank also recalculates using the lower-rate comparison before deducting the applicable penal charge.
4. Does DICGC cover ₹5 lakh principal plus another ₹5 lakh interest?
No. The ₹5 lakh ceiling covers principal and interest together, aggregated in the same right and capacity at the same insured bank.
5. Is TDS the final income tax on FD interest?
No. TDS is credited against the depositor’s final liability. Gross interest must be reported under the applicable tax rules, and additional tax or a refund may result.
6. Does Form 15G or Form 15H make the interest tax-free?
No. An eligible declaration can affect withholding, but taxable interest remains reportable and the statutory conditions must be satisfied.
Key Takeaways
- The covered product is Kotak’s callable domestic FD for 365 days to less than 15 months, not a sweep or non-withdrawable deposit.
- The verified rate table lists 6.35% regular and 6.85% eligible resident senior citizen, checked on 21 October 2026.
- Premature closure uses the actual-tenure rate comparison and the bank’s published penalty slab.
- DICGC’s ₹5 lakh limit aggregates principal and interest in the same right and capacity across the bank.
- Interest is taxable; TDS is a credit mechanism, and Tax Year 2026-27 uses the Income-tax Act, 2025 framework.
Source Links
- Kotak Mahindra Bank — Fixed Deposit Interest Rates and Premature Withdrawal Terms: https://www.kotak.bank.in/en/personal-banking/deposits/fixed-deposit/fixed-deposit-interest-rate.html
- Kotak Mahindra Bank — Fixed Deposit Product Features: https://www.kotak.bank.in/en/personal-banking/deposits/fixed-deposit.html
- DICGC — List of Insured Banks (updated 29 September 2026): https://www.dicgc.org.in/insured-banks
- DICGC — A Guide to Deposit Insurance: https://www.dicgc.org.in/guide-to-deposit-insurance
- Income Tax Department — TDS Compliance FAQs for transition to the Income-tax Act, 2025: https://www.incometax.gov.in/iec/foportal/help/all-topics/e-filing-services/%20tds%20compliance-faq
- Income Tax Department — Tax Payments and transition FAQs: https://www.incometax.gov.in/iec/foportal/help/all-topics/e-filing-services/tax-payments
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Disclaimer: This article is a neutral information guide about one Kotak Mahindra Bank Limited callable domestic fixed-deposit tenure and is based on official material checked on 21 October 2026. It is not a recommendation, ranking, solicitation, prediction of future interest rates or assurance that the product is suitable for any person. The quoted 6.35% regular rate and 6.85% resident-senior-citizen rate relate to the bank’s published 365-days-to-less-than-15-months bucket under the identified schedule; the live booking rate, deposit amount band, customer status, residency, channel, product code, payout option, lien, nomination, renewal instruction and maturity date must be verified before funds are placed. Rates and terms can change for new deposits without advance notice, while an existing deposit is governed by its own advice and contract. Premature withdrawal can materially reduce interest because the bank applies the lower relevant rate for the actual stay and then the applicable penal charge. DICGC insurance is subject to statute and scheme rules, covers eligible principal and interest only up to the aggregate ceiling in the same right and capacity, and does not remove bank, access, liquidity, tax or fraud risk. Income-tax treatment depends on Tax Year 2026-27 law, residential status, method of accounting, total income, ownership and declarations; TDS is not final tax, and Forms 15G/15H are not automatic exemptions. TaxGuru accepts no responsibility for any loss of interest, tax demand, denied credit, penalty, insurance shortfall, premature-closure outcome, operational failure or other consequence arising from reliance on this article. Readers should verify the current bank page, deposit advice, DICGC record and Income Tax Department guidance and obtain advice from a qualified tax or financial professional for their individual circumstances.
