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Finance Calculators

Tax Equivalent Yield Calculator

Verified formula Updated Jun 2026 Private — runs on your device

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Verified formula Private

Tax equivalent yield

7.1429%

For general information only — not financial, tax, legal or medical advice. Verify before you rely on it.

How to use the Tax Equivalent Yield Calculator

The Tax Equivalent Yield Calculator works out your tax equivalent yield in an instant. Enter tax-free yield and your tax rate and the result updates as you type — it is free, needs no sign-up, and runs entirely in your browser so your figures stay private.

  1. Enter the tax-free yield.
  2. Enter the your tax rate.
  3. Read off your tax equivalent yield — the calculator updates automatically, with no button to press.

Formula

The Tax Equivalent Yield Calculator uses the formula:

Tax equivalent yield = Tax-free yield ÷ (1 - Your tax rate ÷ 100)

Worked example

For example, with tax-free yield of 5% and your tax rate of 3%, the tax equivalent yield is 7.1429%.

Inputs used
Tax-free yield 5%
Your tax rate 3%
Results
Tax equivalent yield 7.1429%

Results are estimates for educational use, not professional advice.

Frequently asked questions

It is the taxable yield needed to match a tax-free yield after tax. A 5% tax-free yield at a 30% tax rate equals about 7.14% taxable.

Tax equivalent yield = tax-free yield ÷ (1 − tax rate as a decimal).

It lets you compare tax-free bonds with taxable investments fairly, based on your own tax rate.

Yes. The higher your tax rate, the more valuable a tax-free yield becomes compared with taxable returns.

Enter the tax-free yield. Enter the your tax rate. Read off your tax equivalent yield — the calculator updates automatically, with no button to press.

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