Calculate your car loan EMI, total interest payable, amortization schedule, prepayment savings, and business-use tax benefits
| Interest-to-principal | Category | What it means |
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| Deduction | Annual amount | Tax saved | Section |
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| Region | Typical rate range | Your rate | Status |
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| Year | Principal paid | Interest paid | Total paid | Balance |
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| Metric | Value | Notes |
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Faiq Ur Rahman is a web designer, digital product developer, and founder of Toolraxy, a growing platform of web-based calculators and utility tools. He specializes in building structured, user-friendly tools focused on health, finance, productivity, and everyday problem-solving.
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Car Loan EMI (Equated Monthly Instalment) is the amount a borrower pays periodically to a bank or financial institution to repay a car loan. For a standard monthly amortizing loan, each EMI contains two main components:
Although the EMI may remain the same each month on a fixed-rate loan, the proportion going toward principal and interest changes over time.
Pick your currency from the dropdown at the top. Every prefix on the page switches with it.
Enter the on-road price of the car. Registration and insurance belong in this number, not just the showroom sticker.
Type your down payment. The badge beside the field updates to show what percentage of the price you’re covering.
Set the annual interest rate and the tenure your lender quoted. Tenure accepts 1 to 10 years.
Choose the rate type, add the processing fee percentage, and select your applicant type.
Planning to overpay? Put the extra monthly amount and the month you’ll start in the prepayment row.
Switch vehicle usage to business or mixed if you claim the car against tax, then set your income slab.
Read the result. The large figure is your EMI; the tables underneath break down interest, tax and payoff.
The calculator uses the standard reducing-balance EMI formula. It’s the same equation Indian banks use, so the number here should match your sanction letter to within a rupee or two.
P = loan amount (vehicle price minus down payment)
r = annual interest rate ÷ 12 ÷ 100
n = tenure in years × 12
That’s the whole thing. The top half compounds the principal forward; the bottom half spreads it back into equal monthly slices.
A 9.5% annual rate becomes a monthly rate of 0.0079167. Over five years, n is 60. Feed those into ₹8,00,000 and you get ₹16,803 a month, every month, for sixty months.
A buyer in Pune is looking at a ₹12,40,000 on-road price for a compact SUV. She puts ₹3,10,000 down and finances the rest at 10.25% over six years. The dealer quotes a 1.25% processing fee.
Step 1 – Loan amount: ₹12,40,000 − ₹3,10,000 = ₹9,30,000
Step 2 – Monthly rate: 10.25 ÷ 12 ÷ 100 = 0.0085417
Step 3 – Number of instalments: 6 × 12 = 72
Step 4 – EMI: [9,30,000 × 0.0085417 × (1.0085417)⁷²] ÷ [(1.0085417)⁷² − 1] = ₹17,346
Step 5 – Totals: 72 payments of ₹17,346 add up to ₹12,49,141. Strip out the ₹9,30,000 principal and the interest bill is ₹3,19,141.
That’s an interest-to-principal ratio of 34.3%, which lands squarely in the average band. The processing fee adds ₹11,625, taking the effective cost of borrowing to ₹3,30,766. Add the down payment back and the car’s total outgo is ₹15,70,766.
Now suppose she pays ₹3,000 extra every month starting from month 13. The loan clears in 61 instalments instead of 72, and interest drops to roughly ₹2,74,800. That’s about ₹44,000 saved and eleven payments skipped.
Take the loan amount, multiply it by the monthly rate and by (1 + monthly rate) raised to the number of instalments, then divide by (1 + monthly rate) raised to the instalments minus one. It’s reducing balance, not flat rate. A ₹8 lakh loan at 9.5% over 5 years gives an EMI near ₹16,800.
Between 9% and 11% from a PSU bank is competitive for a new car. Private banks run up to about 12%, NBFCs go higher, and used car loans start around 12%. If your quote sits above the band for your lender type, ask what it takes to move down.
Three years if the payment fits. On ₹8 lakh at 10%, a 3-year loan costs roughly ₹1.29 lakh in interest and a 5-year loan costs about ₹2.20 lakh. The shorter loan wins on total cost; the longer one wins on monthly breathing room.
On a floating-rate loan, yes. RBI rules stop lenders charging individual borrowers a foreclosure fee on floating-rate car loans. Fixed-rate loans usually carry a 2% to 5% charge on the outstanding balance, so read the sanction letter first.
Only for business use. A personal car loan gets no deduction under Section 80C or Section 24(b). If the vehicle is used for business, interest is deductible under Section 37(1) and you can claim 15% WDV depreciation under Section 32. Only the business share counts.
Yes. The down payment reduces the principal, and a smaller principal means a smaller EMI and less total interest. Lenders usually finance 80% to 90% of the on-road price for a new car and 70% to 80% for a used one.
The extra goes straight at the principal, so the balance falls faster and the loan closes early. On a ₹9.3 lakh loan at 10.25%, adding ₹3,000 a month from month 13 clears it in 61 EMIs instead of 72 and saves roughly ₹44,000 in interest.
Tenure is the usual culprit. A 7-year loan at the same rate as a 3-year loan can cost more than twice the interest. A high quoted rate, a used-car loan, or a large processing fee can push the total up as well.
Roughly ₹21,000 if you borrow the full ₹10 lakh at 9.5% over 5 years. Put ₹2 lakh down and the EMI drops to about ₹16,800. Your actual number depends on the rate and tenure your lender approves.
It uses the same reducing-balance formula banks use, so the EMI should match to within a rupee or two. Small gaps appear when a lender rounds the rate, collects advance EMIs, or bundles insurance into the loan. Always check against the sanction letter.
Yes. Enter the used car’s on-road price as the vehicle price and the rate your lender quoted. Used car loans price higher, usually 12% to 18% in India, so switch the benchmark profile to the used car option to see where your rate sits.
The calculator lets you label the loan as a balloon or low-EMI scheme, but it doesn’t model the lump sum due at the end. Treat the EMI shown as the regular instalment only, and ask your lender what the final balloon amount will be before you sign.
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