Calculate simple or compound interest on savings accounts, term deposits, or loans using Australian rates.
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Interest is the cost of borrowing money or the return earned on savings. Australian banks and financial institutions express interest rates as an annual percentage rate (p.a.).
Australian term deposits lock in your money for a fixed period (1 month to 5 years) at a fixed rate. Interest may be paid monthly, quarterly, or at maturity. As of 2026, competitive 12-month term deposit rates range from 4.5%–5.3% p.a.
Many Australian banks offer bonus interest rates on savings accounts when conditions are met (e.g. making a minimum deposit, no withdrawals). The base rate is usually much lower than the bonus rate.
Interest earned on Australian savings and investments is considered assessable income and must be declared in your tax return. Your bank will provide an annual interest summary for tax purposes.
Simple interest is calculated only on the principal. Compound interest is calculated on the principal plus accumulated interest, resulting in faster growth over time — the "eighth wonder of the world."