Post Office Monthly Income Scheme Calculator

What is the Post Office Monthly Income Scheme?

The Post Office Monthly Income Scheme (POMIS) is a government-backed, low-risk deposit that pays a fixed monthly interest. It is popular with retirees and anyone who wants predictable passive income without market risk.

Interest rates are set by the Ministry of Finance and can change from time to time. The usual lock-in period is 5 years, after which the principal is returned.

POMIS calculator formula

Monthly interest is calculated with simple interest:

• Monthly interest = (Investment amount × Annual interest rate) ÷ 12
• Total interest over the lock-in = Monthly interest × 12 × Lock-in years
• At maturity, you get your principal back; interest is paid out every month during the tenure

ClearTax example

Mr A invests ₹1,00,000 for 5 years at 7.4% p.a.

Monthly income = (1,00,000 × 7.4%) ÷ 12 = ₹616.67 (shown as ₹617 when rounded).

Over 5 years, total interest is about ₹37,000, and the ₹1,00,000 principal is returned at maturity.

Is POMIS taxable?

Yes. Interest earned on POMIS is taxable as per your income tax slab. There is no Section 80C deduction on the deposit itself.

Because returns are fixed and taxable, compare post-tax income with other options before investing a large amount.

How to use this calculator

• Enter the amount you plan to invest.
• Set the current annual interest rate (default is the illustrative 7.4%).
• Choose the lock-in period in years (typically 5).
• Review monthly interest, total interest, and amount returned at maturity.