How to calculate interest tax?

Interest tax refers to the tax levied on the earned interest. China levies 5%, 10% and 20% interest tax on deposit interest, but it is temporarily exempted from interest tax from June 9, 2008. The following is the algorithm of deposit interest tax:

1, calculation formula

Interest tax = principal × deposit interest rate × deposit term × interest tax rate

2. Calculation case

Mr. A deposited a three-year fixed deposit of RMB 50,000 in China Construction Bank, with a deposit interest rate of 3.85%. If the interest tax rate is 5%, we can know that the amount of interest tax to be paid is as follows through calculation:

Interest tax: 50,000× 3.85 %× 3× 5% = 288.75 yuan.

Pre-tax interest: 50,000× 3.85 %× 3 = 5,775 yuan.