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Business Desk – Senior Citizen Savings Scheme: If you are a senior citizen and want to arrange regular income after retirement, then Post Office Senior Citizens Savings Scheme (SCSS) is an option. Currently, this scheme is offering 8.2% annual interest. In this, interest is given every quarter.

On maximum investment of Rs 30 lakh, annual interest is Rs 2.46 lakh and every three months you get Rs 61,500. The maturity period of the scheme is 5 years, which can be extended for further 3 years.

Annual interest of Rs 2.46 lakh on investment of Rs 30 lakh

An account can be opened in Post Office Senior Citizens Savings Scheme with a minimum of Rs 1,000. A maximum investment of up to Rs 30 lakh can be made in this. It is giving 8.2% annual interest.

If a person invests Rs 30 lakh, the annual interest at the rate of 8.2% will be Rs 2,46,000. Since interest is paid on quarterly basis, Rs 61,500 interest will be earned every three months. That means a total interest of Rs 2.46 lakh will be received during the four quarters of the entire year.

Maturity period is 5 years

The maturity period of SCSS is 5 years. That means the investment period is five years. However, with certain conditions the account can be closed before the completion of 5 years, but a penalty has to be paid for premature closure.

After maturity, the account can be extended for another 3 years. If the account holder does not wish to extend it further, the original amount invested can be withdrawn on maturity.

Interest is available on 1st April, 1st July, 1st October and 1st January

In this scheme, interest is paid on quarterly basis. The interest amount is deposited in the account on 1st April, 1st July, 1st October and 1st January.

The interest amount is deposited in the savings account present in the same post office. If the account holder does not withdraw the interest amount, then no additional interest or compound interest is received on that deposited interest.

Rs 42.30 lakh on Rs 30 lakh if ​​interest is not withdrawn for 5 years?

If a person invests Rs 30 lakh and does not withdraw the interest received every quarter for five years, then the total amount of interest will be Rs 12.30 lakh. In this way, the total amount including principal amount of Rs 30 lakh and interest of Rs 12.30 lakh will be Rs 42.30 lakh.

However, it is important to note that compound interest is not available on quarterly interest in SCSS. Therefore, the figure of Rs 42.30 lakh is formed by adding the principal amount and the simple interest received during five years.

Tax exemption under Section 80C

By investing in this scheme, tax exemption can be availed under Section 80C of the Income Tax Act. Under this, a maximum deduction of up to Rs 1.5 lakh can be claimed from the total income on eligible investments. However, the actual benefit may vary depending on the tax rules and your tax regime.

People of 60 years of age or above can open an account

A person aged 60 years or above can open a SCSS account by visiting the post office. Apart from this, a person taking VRS, whose age is more than 55 years but less than 60 years, can also invest in this scheme. At the same time, people above 50 years of age and below 60 years of age who have retired from the Defense Department can also be eligible. In such a situation, the investment has to be made within one month of retirement.

Disclaimer

This story is for information only. Before taking any investment decision, understand your financial situation, tax rules and existing scheme terms and seek advice from a qualified financial advisor if necessary.