Bank of Baroda: Minimum Rs 1,000 and maximum Rs 15 lakh can be deposited under Senior Citizen Saving Scheme. This scheme, introduced to provide risk-free fixed returns to the elders of the country, matures in five years.
Bank of Baroda, the third largest state-run bank in the country, takes special care of its customers. The bank runs several schemes for customers. One of these schemes is the Senior Citizen Savings Scheme (SCSS) of the post office. According to the information provided on the bank’s website, the scheme is also applicable for retired persons above the age of 55 years and retired personnel of the defense services for 50 years (excluding civilian security staff) under the voluntary or special voluntary scheme.
What is Senior Citizen Savings Scheme SCSS-Senior Citizen Savings Scheme
A minimum of Rs 1,000 and a maximum of Rs 15 lakh can be deposited under the Senior Citizen Saving Scheme. This scheme, introduced to provide risk-free fixed returns to the elders of the country, matures in five years.
If you invest a lump sum of Rs 10 lakh in the Senior Citizens Scheme, then after 5 years, the total amount on maturity will be Rs 14,28,964, which is more than Rs 14 lakh, according to the interest rate of 7.4% (compounding) annually. Here you are getting a benefit of Rs 4,28,964 as interest.
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 getting the retirement benefits and the amount to be deposited in it should not be more than the amortization of the retirement benefits.
Under SCSS, the depositor can also keep more than one account at the joint with individual or his wife / husband. But together with all, the maximum investment limit cannot be more than 15 lakhs. Accounts with less than 1 lakh can be opened in cash, but for more than that, a check has to be used.
The Union Ministry of Finance reviews the interest rate of the SCSS every three months. The calculation of interest in SCSS is done every quarter. Accordingly, interest amount is added to your account on 31 March, 30 June, 30 September and 31 December.
What is the duration of this plan?
According to the Bank of Baroda, money is invested in this scheme for 5 years. This can be extended for 3 years.
How much interest are you getting now
Account holders can earn up to 7.4 percent interest on their deposits. The government fixes its interest rates every 3 months. The interest rates for the period from 1 January 2021 to 31 March 2021 are 7.4 per cent. Interest is fully taxable. That is, tax will be charged on it. Yes, tax will be deducted at source.
How much money can i invest
How much will the investment be in multiples of – 1000 rupees
The minimum and maximum deposit limit is 15 lakh rupees.
How much tax will have to be paid
Talking about tax, if your interest amount exceeds Rs 10,000 annually under SCSS, then your TDS gets deducted. However, investment in this scheme is exempt under Section 80C of the Income Tax Act.
Who can invest in Senior Citizen Savings Scheme SCSS
Senior citizens of the age of 60 years or more are eligible for this scheme. The scheme is also applicable for retired persons above 55 years of age and retired personnel of Defense Services for 50 years (excluding civilian security staff) under the voluntary or special voluntary scheme.
Depositors are allowed to open multiple accounts under this scheme with a maximum limit of Rs 15 lakh. Senior Citizen Savings Scheme (SCSS) account is a reliable and secure scheme, specially designed for seniors to earn long term savings in their old age. This facility is available in all branches of the bank.
When can you withdraw money
The account holder can close the account and withdraw the deposit at any time with certain conditions. If you do not want to advance the account, you can withdraw money.
The account can be closed at any time after the expiry of one year from the date of extension of the account without any deduction.
If premature closure is to be made, interest on the deposit will be payable after the deduction of the specified penalty till the earlier date of premature closure.
This account cannot be transferred. It cannot be used for business use. Nomination facility is available.
Nomination facility is available at the time of opening and closing the account. Account can be transferred from one branch to another branch.
After completion of the maturity period, the account can be extended for another three years. For this, application has to be given within one year of the maturity date.