Term deposits offer a guaranteed return on your money for a fixed period — from 1 month to 5 years. With the RBA cash rate at 4.10% in 2026, term deposit rates are at their highest level in over a decade. Here is what you need to know.
Best Term Deposit Rates — April 2026
| Institution | 3 months | 6 months | 12 months | Min deposit |
|---|---|---|---|---|
| Judo Bank | 5.15% | 5.25% | 5.00% | $1,000 |
| Macquarie Bank | 5.00% | 5.10% | 4.90% | $5,000 |
| ING | 4.80% | 4.95% | 4.75% | $10,000 |
| ANZ | 4.50% | 4.60% | 4.50% | $5,000 |
| Commonwealth Bank | 4.40% | 4.55% | 4.40% | $5,000 |
How Term Deposits Work
You deposit a lump sum with a bank for a fixed term at a fixed interest rate. At maturity (end of the term), you receive your principal plus interest. Early withdrawal is typically penalised — you may receive a reduced rate or pay a break fee.
How Much Can You Earn?
| Deposit | 6mo @ 5.00% | 12mo @ 5.00% | 24mo @ 4.75% |
|---|---|---|---|
| $10,000 | +$247 | +$500 | +$970 |
| $50,000 | +$1,233 | +$2,500 | +$4,848 |
| $100,000 | +$2,466 | +$5,000 | +$9,690 |
Term Deposits and Tax
Interest earned on term deposits is assessable income in Australia and must be declared in your tax return. Interest is generally taxed in the year it is received (at maturity or when credited). If you hold a multi-year term deposit, the timing of when you declare interest depends on your accounting method — check with your accountant.
Are Term Deposits Safe?
Term deposits held with ADIs (Authorised Deposit-taking Institutions — banks, credit unions, building societies) licensed by APRA are protected by the Australian Government’s Financial Claims Scheme up to $250,000 per account holder per institution.
Disclaimer: General information only. Not financial advice. Always consult a licensed professional before making financial decisions.