Post Office Saving Schemes – Overview, Plans & Benefits

Last Updated at: February 03, 2020
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Post office saving schemes – Overview, plans & benefits

Savings for the future is important. It ensures that you have a safe and secure future. There are a number of options when it comes to a savings plan, and in this article, we are going to unfold the details about Post Office Schemes. There are a number of plans which fall under the Indian Post Office Schemes that offer a risk-free return on investment. These schemes run in 1.54 lakh post offices in India.

Different Post Office Schemes

  1. Post Office Savings Account
  2. 5-Year Post Office Recurring Deposit Account (RD)
  3. Post Office Time Deposit Account (TD)
  4. Post Office Monthly Income Scheme Account (MIS)
  5. Senior Citizen Savings Scheme (SCSS)
  6. 15 years Public Provident Fund Account (PPF)
  7. National Savings Certificates (NSC)
  8. Kisan Vikas Patra (KVP)
  9. Sukanya Samriddhi Accounts (SSA)

Here is a brief overview of the different post office investment and post office interest rates:

Scheme
Interest Rate
Minimum Investment
Maximum Investment
Eligibility
Tax Implications
Post Office Savings Account
4% per annum One can start from as low as  Rs. 20 No limit The applicant must be a resident Indian, Minor or Major One can claim the tax benefit of up to Rs. 50,000 from the financial year 2018-19
Non-Cheque Facility Rs. 50
Post Office Time Deposit Account (TD)
1st Year– 6.9% p.a. One can start with as low as Rs. 200 No limit Individual As per Section 80C, one gets the tax benefit up to 5 years on  deposits
2nd Year -6.9% p.a.
3rd Year– 6.9% p.a.
4th Year – 7.7% p.a.
Post Office Monthly Income Scheme Account (MIS)
7.6 % per annum (one can pay monthly) One can start with as low as Rs. 1500 In the case of one account holder, Rs. 4.5 lakhs and 9 lakhs for joint holders. Individual The interest earned is taxable and no deduction under Sec 80C for Deposits made
Senior Citizen Savings Scheme (SCSS)
8.6 % per annum and it is compounded annually One can start with as low as Rs. 1000 Maximum deposit Rs. 15 Lakh Any individual who is above the age of 60 years or individuals who are above 55 years and have taken the VRS or Superannuation Depositor gets tax benefit under 80C
If the interest earned is more than Rs. 50,000 (p.a.), TDS is deducted on the same
15 year Public Provident Fund Account (PPF)
7.9 % per annum and it is compounded annually Rs. 500 per financial year Rs. 1.5 Lakh per financial year Individual Tax rebate under section 80C for deposits (maximum Rs. 1.5 Lakh pa)
National Savings Certificates (NSC)
7.9 % per annum and it is compounded annually Rs. 100 No Limit Individual The depositor gets the tax rebate under Section 80C for deposits (maximum Rs. 1.5 Lakh p.a.)
Kisan Vikas Patra (KVP)
7.6 % per annum and it is compounded annually Rs. 1,000 No limit Individual (Adult) Interest is taxable but when the depositor gets the amount on maturity, then there it is non-taxable
Sukanya Samriddhi Accounts
8.4 % per annum and it is compounded annually Rs 1000 per financial year Rs 1.5 Lakh per financial year Girl Child – up to 10 years from birth and 1 additional year of grace Investment (up to Rs 1.5 Lakh exempt under Section 80C), interest and amount received on maturity is tax-free

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Advantages of the Postal Saving Schemes

If you have planned to go ahead with the Post Office scheme, then you will get several advantages. Some of those are enumerated below:

  • Easy investment– One of the reasons why you should be going ahead with the post office saving scheme is that one can easily enrol for the same. Moreover, it is a risk-free return, so you don’t really have to worry about your money.
  • Long–term investment gain– Some of the post office saving plans extend for a period of 15 years, which makes it easy for the people who are retiring to get the benefit.
  • Tax exemption- Another advantage of post office saving scheme is that you will get tax exemption under Section 80C for the deposit amount. The interest earned on some new Post Office schemes, like Sukanya Samriddhi Yojana, are also exempted from tax.
  • A wide array of options- Apart from the tax benefit and interest earned, the post office schemes also have offered a wide spectrum of schemes which you can choose as per the budget and investment requirement.

To ensure that the customer gets the right understanding of the different schemes, the details of the post office scheme in Hindi are available online. With these schemes, you can have a safe and secure future.

Frequently Asked Questions (FAQs)

1. Is post office savings tax-free?

 

Interest income earned from savings accounts, under Section 80TTA, including the Post Office Savings Account, up to Rs.10,000 is tax-deductible from the gross income. However, for senior citizens, no deduction under Section 80TTA is allowed.

2. How much money can be deposit in the post office?

 

Single account holders can deposit a maximum of Rs.1 lakh while joint account holders can deposit a maximum of Rs.2 lakhs.
3. Is there a maturity period?
No, one of the main features of a Post Office savings account is that there is no lock-in or maturity period.

 

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Post Office Saving Schemes – Overview, Plans & Benefits

586

Savings for the future is important. It ensures that you have a safe and secure future. There are a number of options when it comes to a savings plan, and in this article, we are going to unfold the details about Post Office Schemes. There are a number of plans which fall under the Indian Post Office Schemes that offer a risk-free return on investment. These schemes run in 1.54 lakh post offices in India.

Different Post Office Schemes

  1. Post Office Savings Account
  2. 5-Year Post Office Recurring Deposit Account (RD)
  3. Post Office Time Deposit Account (TD)
  4. Post Office Monthly Income Scheme Account (MIS)
  5. Senior Citizen Savings Scheme (SCSS)
  6. 15 years Public Provident Fund Account (PPF)
  7. National Savings Certificates (NSC)
  8. Kisan Vikas Patra (KVP)
  9. Sukanya Samriddhi Accounts (SSA)

Here is a brief overview of the different post office investment and post office interest rates:

Scheme
Interest Rate
Minimum Investment
Maximum Investment
Eligibility
Tax Implications
Post Office Savings Account
4% per annum One can start from as low as  Rs. 20 No limit The applicant must be a resident Indian, Minor or Major One can claim the tax benefit of up to Rs. 50,000 from the financial year 2018-19
Non-Cheque Facility Rs. 50
Post Office Time Deposit Account (TD)
1st Year– 6.9% p.a. One can start with as low as Rs. 200 No limit Individual As per Section 80C, one gets the tax benefit up to 5 years on  deposits
2nd Year -6.9% p.a.
3rd Year– 6.9% p.a.
4th Year – 7.7% p.a.
Post Office Monthly Income Scheme Account (MIS)
7.6 % per annum (one can pay monthly) One can start with as low as Rs. 1500 In the case of one account holder, Rs. 4.5 lakhs and 9 lakhs for joint holders. Individual The interest earned is taxable and no deduction under Sec 80C for Deposits made
Senior Citizen Savings Scheme (SCSS)
8.6 % per annum and it is compounded annually One can start with as low as Rs. 1000 Maximum deposit Rs. 15 Lakh Any individual who is above the age of 60 years or individuals who are above 55 years and have taken the VRS or Superannuation Depositor gets tax benefit under 80C
If the interest earned is more than Rs. 50,000 (p.a.), TDS is deducted on the same
15 year Public Provident Fund Account (PPF)
7.9 % per annum and it is compounded annually Rs. 500 per financial year Rs. 1.5 Lakh per financial year Individual Tax rebate under section 80C for deposits (maximum Rs. 1.5 Lakh pa)
National Savings Certificates (NSC)
7.9 % per annum and it is compounded annually Rs. 100 No Limit Individual The depositor gets the tax rebate under Section 80C for deposits (maximum Rs. 1.5 Lakh p.a.)
Kisan Vikas Patra (KVP)
7.6 % per annum and it is compounded annually Rs. 1,000 No limit Individual (Adult) Interest is taxable but when the depositor gets the amount on maturity, then there it is non-taxable
Sukanya Samriddhi Accounts
8.4 % per annum and it is compounded annually Rs 1000 per financial year Rs 1.5 Lakh per financial year Girl Child – up to 10 years from birth and 1 additional year of grace Investment (up to Rs 1.5 Lakh exempt under Section 80C), interest and amount received on maturity is tax-free

get legal advice now

Advantages of the Postal Saving Schemes

If you have planned to go ahead with the Post Office scheme, then you will get several advantages. Some of those are enumerated below:

  • Easy investment– One of the reasons why you should be going ahead with the post office saving scheme is that one can easily enrol for the same. Moreover, it is a risk-free return, so you don’t really have to worry about your money.
  • Long–term investment gain– Some of the post office saving plans extend for a period of 15 years, which makes it easy for the people who are retiring to get the benefit.
  • Tax exemption- Another advantage of post office saving scheme is that you will get tax exemption under Section 80C for the deposit amount. The interest earned on some new Post Office schemes, like Sukanya Samriddhi Yojana, are also exempted from tax.
  • A wide array of options- Apart from the tax benefit and interest earned, the post office schemes also have offered a wide spectrum of schemes which you can choose as per the budget and investment requirement.

To ensure that the customer gets the right understanding of the different schemes, the details of the post office scheme in Hindi are available online. With these schemes, you can have a safe and secure future.

Frequently Asked Questions (FAQs)

1. Is post office savings tax-free?

 

Interest income earned from savings accounts, under Section 80TTA, including the Post Office Savings Account, up to Rs.10,000 is tax-deductible from the gross income. However, for senior citizens, no deduction under Section 80TTA is allowed.

2. How much money can be deposit in the post office?

 

Single account holders can deposit a maximum of Rs.1 lakh while joint account holders can deposit a maximum of Rs.2 lakhs.
3. Is there a maturity period?
No, one of the main features of a Post Office savings account is that there is no lock-in or maturity period.

 

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