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A Treasury bill calculator converts a quoted discount rate into the actual price you pay for a short-term government security, and back again. Enter a face value, a discount rate, and a maturity period, and the tool returns the purchase price, the discount amount, and the annualised yield. For investors parking surplus cash for 91, 182, or 364 days, this calculation is the difference between knowing your true return and guessing at it. A T-bill calculator removes that guesswork entirely.
Treasury bills are discount instruments. You do not receive periodic interest. Instead, you buy the bill at a price below its face value and receive the full face value at maturity. The difference is your return. A date difference calculator handles the broader question of days between two dates, but a T-bill calculator applies a specific financial formula to that day count.
The calculator works in two directions. If you know the discount rate quoted at auction, it computes the purchase price. If you know the price and want to verify the yield, it computes the annualised return. Both directions use the same underlying relationship: price, face value, days to maturity, and the day-count convention that governs the market.
For US Treasury bills, the standard formula is:
Where P is the price per $100 of face value, d is the discount rate expressed as a decimal, and r is the number of days remaining to maturity. The 360 in the denominator is the US money market convention — it assumes a 360-day year, which is a historical standard for short-term interest calculations[reference:0].
A worked example makes this concrete. Suppose a 91-day bill is auctioned at a discount rate of 5.28%. The price per $100 would be:
You pay $98.665 for every $100 of face value. At maturity, you receive $100. The $1.335 difference is your return over 91 days. Annualised on the 365-day basis used for investment yield, that works out to approximately 5.43% — noticeably higher than the quoted discount rate because the return is calculated on the price you actually paid, not the face value.
The key insight is that the discount rate and the investment yield are not the same number. The discount rate is always lower. The financial calculator index on this site includes tools that handle both conventions.
Two yields are quoted for every T-bill, and confusing them leads to wrong return expectations.
The formula for investment yield is:
For Indian T-bills, the RBI uses the 365-day convention directly for yield calculation, so the quoted yield already reflects the investment yield[reference:1]. The cut-off price published after each auction is the price you pay, and the implicit yield is the return on that price.
The Reserve Bank of India conducts weekly auctions of 91-day, 182-day, and 364-day Treasury bills on behalf of the Government of India. Each auction result publishes three critical numbers: the notified amount, the cut-off price, and the implicit yield at the cut-off price.
A recent auction from September 2026 illustrates the pattern. The 91-day bill was issued at a cut-off price of ₹98.7007, implying a yield of 5.2801%. The 182-day bill cleared at ₹97.2128 with a yield of 5.7500%, and the 364-day bill at ₹94.3200 with a yield of 6.0386%[reference:2]. The yields rise with maturity — a normal pattern when the market expects short-term rates to stay elevated or rise.
The notified amounts vary. In that auction, the RBI offered ₹9,000 crore of 91-day bills, ₹8,000 crore of 182-day bills, and ₹7,000 crore of 364-day bills. Bids received consistently exceed the notified amount, which is why partial allotment percentages apply to competitive bidders[reference:3].
For retail investors, the RBI Retail Direct platform allows non-competitive bids of ₹25,000 and above. The age calculator is not relevant here, but the principle of using the right tool for the right input applies equally: use the RBI's published cut-off price as the input to a T-bill calculator, and you will get the exact return you can expect.
Spreadsheet users can build a T-bill calculator in two cells. The first input is the discount rate; the second is the days to maturity. The output is the price per 100 of face value.
For a US-style 360-day discount rate:
Where A1 is the discount rate as a decimal (e.g., 0.0528) and A2 is the days to maturity.
For the investment yield, the formula is:
Where B1 is the price calculated in the previous step.
For Indian T-bills, which use the 365-day convention, the yield formula simplifies to the same structure but with 365 in the numerator of the annualisation factor. The RBI's published yield will match this calculation to two decimal places.
A common mistake is to use the discount rate directly in a compound interest formula. T-bills are not compound interest instruments. They are single-payment discount securities. Treating them as compound interest vehicles overstates the return.
The comparison between Treasury bills and bank fixed deposits is not straightforward because the tax treatment and liquidity differ, and the yield advantage flips depending on the tenure.
In the shorter tenures — 91 and 182 days — T-bills generally offer higher yields than comparable bank FDs. An analysis from the Economic Times found that T-bills in the 91-day and 182-day segments offered around 55 basis points over FDs of similar maturities[reference:4]. For the one-year segment, the picture reverses: bank FDs offered at least 68 basis points higher than 364-day T-bills in the same analysis.
| Feature | Treasury Bills | Bank Fixed Deposits |
|---|---|---|
| Credit risk | Sovereign — effectively zero | Bank credit risk; insured up to ₹5 lakh per bank |
| Tenure | 91, 182, or 364 days | 7 days to 10 years |
| Liquidity | Tradable on NSE NDS-OM; can sell before maturity | Premature withdrawal with penalty |
| Taxation | Short-term capital gains; taxed at slab rate; no TDS | Interest income; taxed at slab rate; TDS above ₹40,000 (₹50,000 for seniors) |
| Minimum investment | ₹25,000 (Retail Direct) | Varies; as low as ₹1,000 at some banks |
The tax difference matters. T-bill gains are treated as short-term capital gains because the instruments mature within 364 days. No TDS is deducted at source, which means the full return is available until you file your return and pay tax at your slab rate[reference:5]. FD interest is taxed as interest income, and TDS applies above the threshold. For investors in the 30% bracket, the post-tax advantage of T-bills over FDs in the short-tenure segment can be meaningful.
The core pricing logic is the same across countries, but the day-count convention and the auction mechanism differ.
In the United Kingdom, Treasury bills are issued by the Debt Management Office through weekly tenders. The DMO uses a 365-day year for yield calculations, similar to India. UK T-bill rates in 2026 have ranged around 4.40% for 1-month bills and 4.40% for 3-month bills[reference:6]. UK T-bill interest is classified as income from a deeply discounted security and is taxable under income tax rules[reference:7].
In Canada, Government of Canada Treasury bills are issued through auctions administered by the Bank of Canada. Canadian T-bills use an actual/365 day-count basis. The pricing formula is the same present-value calculation: price equals face value divided by (1 plus the yield times days divided by 365).
In Australia, Treasury bills are issued by the Australian Office of Financial Management. The Australian market typically uses a 365-day year for yield calculations on short-term government securities. The formula for price from yield is:
This is the investment-yield pricing formula, as opposed to the discount-rate pricing formula used in the US. The distinction matters: if you use the wrong formula, your calculated price will be slightly off, and on a large investment that difference compounds.
A T-bill calculator takes the face value (maturity amount), the discount rate (or quoted yield), and the number of days to maturity, then applies the discount pricing formula to return the purchase price. It works backward from what you will receive at maturity to what you pay today, which is always less than the face value.
Discount yield is calculated on the face value using a 360-day year, and it is the convention used in US Treasury auctions. Investment yield (also called coupon-equivalent yield or bond equivalent yield) is calculated on the purchase price using a 365-day year. Investment yield is always higher because the same dollar return is divided by a smaller base and annualised over more days.
Yes, but you must use the correct day-count convention. Indian T-bills use an actual/365 day-count basis for yield calculation, not the 360-day convention used for US T-bills. The RBI publishes cut-off prices and implicit yields after every weekly auction, and a calculator configured for the 365-day basis will match those figures.
Gains from Treasury bills in India are treated as short-term capital gains because T-bills mature within 364 days. The discount income is added to your total taxable income and taxed at your applicable slab rate. No TDS is deducted at source, unlike fixed deposits.
The minimum investment for Treasury bills in India is ₹25,000 on the RBI Retail Direct platform. On the NSE's NDS-OM platform, the minimum lot size is ₹25,000 as well. Institutional investors bid in multiples of ₹1 crore at RBI auctions.
Treasury bills carry sovereign credit risk, which is effectively zero for countries like India, the United States, the United Kingdom, and Canada. They are the closest thing to a risk-free investment available. However, if you sell a T-bill before maturity on the secondary market, the price you receive can be higher or lower than your purchase price depending on prevailing interest rates.
T-bill yields are set at weekly auctions through competitive bidding. The cut-off yield reflects the market's assessment of short-term interest rates, liquidity conditions, inflation expectations, and central bank policy. When the RBI or the Federal Reserve signals a rate change, T-bill yields adjust within days.
For US T-bills, use the formula: Price = Face Value × (1 − (Discount Rate × Days to Maturity ÷ 360)). For Indian T-bills, the RBI publishes the cut-off price directly, but you can verify it using the yield formula: Yield = ((100 − Price) ÷ Price) × (365 ÷ Days) × 100. If you know the yield and want the price, rearrange to: Price = 100 ÷ (1 + (Yield × Days ÷ 365)).
Treasury bills mature in one year or less and pay no periodic interest. They are issued at a discount to face value, and the difference between the purchase price and face value is the return. Treasury bonds and notes have maturities of two years or more, pay semi-annual interest (coupon payments), and can be traded in the secondary market with accrued interest. T-bills are money market instruments; bonds are capital market instruments.
Yes. Treasury bills can be sold on the secondary market before maturity. In India, you can sell them on the NSE's NDS-OM platform or through your broker. In the US, you can sell them through TreasuryDirect or a broker. The price you receive depends on prevailing yields. If yields have fallen since you bought, your T-bill will trade at a premium. If yields have risen, it will trade at a discount.
In the end, a Treasury bill calculator is a bridge between the quoted auction yield and the actual cash flow you will experience. The discount rate tells you what the market is bidding; the purchase price tells you what you will pay; the investment yield tells you what you will earn. For short-term parking of funds with sovereign backing, those three numbers are all you need. Use the calculator above to run your own inputs, cross-check against the latest auction results from the RBI or Treasury Department, and treat the output as a precise measure of the return on your capital — not an estimate.