Diwali investment in POSCSS: The annual interest in the scheme will be 7.4 percent. The maturity period in this scheme is 5 years. Deposits can be made in multiples of Rs 1000.
Post Office Senior Citizen Savings Scheme (SCSS): Small savings schemes of the post office have always been a better option for investment. The best thing about this is that the deposit is completely safe with guaranteed returns. These investments are not affected by market fluctuations. The post office offers a variety of deposit schemes. One of these schemes is the Senior Citizen Savings Scheme (SCSS) of the Post Office. This Diwali you can give this financial gift to your parents.
Deposit on 5 lac 6.85 lac
If you invest a lump sum of Rs 5 lakh in the Senior Citizens Scheme, then at the rate of interest of 7.4 per cent (compounding) per annum, the total amount after 5 years i.e. on maturity will be Rs 6,85,000. Here you are getting the benefit of Rs 1,85,000 as interest. In this way, every quarter interest will be Rs 9,250.
SCSS: 7.4% interest per annum, maturity of 5 years
According to the information available on the website of the post office, the annual interest in this scheme will be 7.4%. The maturity period in this scheme is 5 years. Deposits can be made in multiples of Rs 1000. Also, a maximum investment of Rs 15 lakh can be made in this. It has to be invested in lump sum.
Under SCSS, an account can be opened by a person of 60 years of age and above. If someone is 55 years or more but less than 60 years old and has taken VRS then he can also open an account in SCSS. But the condition is that he has to open this account within one month of receiving the retirement benefits and the amount deposited in it should not exceed the amount of retirement benefits.
According to the website, under SCSS, a depositor can hold more than one account either individually or jointly with his/her spouse. But all together the maximum investment limit cannot exceed 15 lakhs. Accounts can be opened in cash with an amount less than 1 lakh but for more than that, cheque will have to be used.
SCSS: Nomination facility is available
Nomination facility is available at the time of opening and closing the account in Senior Citizen Savings Schemes. This account can be transferred from one post office to another. In this account holder can do premature closure. But the post office will deduct 1.5 percent of the deposit only on closing the account after 1 year of account opening, while 1 percent of the deposit will be deducted after 2 years of closure.
Can be extended for 3 years after maturity
The account can be extended for another three years after the maturity of SCSS. For this, the application has to be submitted within one year from the date of maturity. Tax deduction is also available on deposits in this account. Investment in this scheme is exempted under section 80C of the Income Tax Act.
Income from interest in SCSS is taxed. If the interest income of all your SCSS exceeds Rs 50,000 per annum, then your TDS starts deducting. The tax amount is deducted from your interest. If the interest income does not exceed the prescribed limit, then you can get relief from TDS by submitting Form 15G/15H.
