EMI Calculator

EMI = [P × R × (1+R)^N] / [(1+R)^N - 1], where P is the principal, R is the monthly interest rate (annual rate / 12 / 100), and N is the number of monthly instalments. The FinTax24 calculator applies this formula for every loan type (home, car, personal, education, gold).

Reducing-balance EMI charges interest on the outstanding principal — most legitimate lenders use it. Flat-rate EMI computes interest on the original principal throughout, leading to effective rates 1.85-2× the displayed rate. The calculator always uses reducing-balance, the standard for Indian retail lending.

Either, depending on the bank. Most lenders offer a one-time choice per prepayment: reduce EMI (cash flow benefit) or reduce tenure (interest saving). Reducing tenure typically saves 30-50% of remaining interest and is preferred unless you want more cash flow.

Yes — service tax on the value of the loan is GST 18% and is collected on the EMI along with interest and principal. Processing fees, documentation charges and foreclosure charges also attract 18% GST. Calculator does not add GST to EMI — check lender’s quote.

If the loan is on a floating rate linked to the bank’s MCLR / external benchmark, every rate change adjusts EMI on the next reset date. Calculator handles rate-change sensitivity by re-running EMI formula at the new rate — useful for stress-testing affordability.

For floating-rate home loans and personal loans, RBI has banned prepayment penalties for individual borrowers. For fixed-rate loans and NBFC loans, prepayment charges of 2-4% may apply on the outstanding principal. Calculator does not factor prepayment penalty into EMI math.