Bond Coupon Payment Calculator: Annual Income From a Bond
Work out the annual coupon payment on a bond from its face value and coupon rate — the predictable income side of fixed income investing.
Adjust the inputs and select Calculate for a full breakdown.
Compare Common Scenarios
How the numbers shift across typical situations for this calculator:
| Scenario | Annual coupon payment | Principal at face |
|---|---|---|
| 5% on $1,000 face | 50 | 950 |
| 3% on $5,000 face | 150 | 4,850 |
| 7% on $1,000 face | 70 | 930 |
| 4.25% on $25,000 face | 1,062.5 | 23,937.5 |
How This Calculator Works
Enter the bond's face value and its coupon rate. The calculator multiplies the two to give the annual coupon payment and shows the principal that continues to earn it. Most US bonds split the payment into two semi-annual installments — halve the annual figure for one payment.
The Formula
Percentage of an Amount
Amount is the base value, Percentage is the rate applied to it
Worked Example
A $1,000 face value bond with a 5% coupon pays $50 a year — typically $25 every six months. Holding 100 such bonds is $5,000 a year of contractual income, regardless of where the bond's market price sits in the meantime.
Key Insight
Coupon payments are fixed at issue and do not change with market interest rates. When rates rise, a 5% coupon bond's price falls so its yield to maturity matches the new market — but the coupon you receive remains $50 a year on each $1,000 face value. Coupon income and bond price move on different schedules.
Frequently Asked Questions
How is a bond coupon payment calculated?
Multiply face value by the coupon rate. A 5% coupon on a $1,000 face value bond pays $50 a year, usually split into two $25 semi-annual payments.
Is coupon rate the same as yield?
No. The coupon rate is fixed at issue and tied to face value. Yield depends on the price you actually paid — a bond bought below face value has a current yield higher than its coupon rate.
How often are coupons paid?
US bonds typically pay semi-annually, so each payment is half the annual amount. Some bonds pay annually, quarterly, or monthly — check the bond's terms.
Are coupon payments taxable?
Generally yes — taxed as ordinary income at federal level. US Treasury coupons are exempt from state and local tax; municipal bond coupons are often exempt from federal tax. Tax treatment varies by issuer.
What is a zero-coupon bond?
A bond with no coupon payments. It is issued at a discount to face value and returns the face value at maturity — the entire return is the discount. This calculator does not apply to zero-coupons.
Related Calculators
Data Sources & Benchmarks
This calculator draws on 1 independent, dated source. The starting values for coupon rate are taken from the benchmarks below and refresh whenever the snapshots are updated.
Methodology & Review
The coupon payment is face value multiplied by the coupon rate. Most US bonds pay semi-annually; divide the annual figure by two to get one payment. The calculator shows the annual amount and the principal that continues to earn it.
Written by Ugo Candido · Last updated May 17, 2026.