Post Office Investment Savings Schemes and Interest Rate: Post office investment consists of many savings schemes that provide high interest rate as well as tax benefits and most importantly, the Government of India is guaranteed that all these schemes have tax exemption under Income Tax Section 80C. That is, there will be no tax on investments up to Rs 1,50,000. There are some schemes like Public Provident Fund (PPF), Sukanya Samriddhi Yojana (SSY), National Savings Certificate (NSC), Post Office Time Deposit for 5 years and Senior Citizen Savings Scheme (SCSS).
|Small saving scheme||Interest rate||Tax benefit on investment?||Will interest be taxed?|
|Post office savings account||4.0%||No||Yes|
|Post office recording deposit||7.2%||No||Yes|
|Post office monthly income plan||7.6%||No||Yes|
|Post Office Time Deposit (1 Year)||6.9%||No||Yes|
|Post Office Time Deposit (2 years)||6.9%||No||Yes|
|Post Office Time Deposit (3 years)||6.9%||No||Yes|
|Post Office Time Deposit (5 years)||7.7%||Yes||Yes|
|Kisan Vikas Patra||7.6%||No||Yes|
|Public provident fund||7.9%||Yes||No|
|Sukanya Samriddhi Yojana||8.4%||Yes||No|
|National Savings Certificate||7.9%||Yes||No|
|Senior Citizen Savings Scheme||8.6%||Yes||Yes|
* Tax saving deposit for 5 years, third quarter interest rate, financial year 2019-20 (October-December 2019)
The interest rates on these schemes are reviewed by the government every three months. Whatever quarter you invest in Post Office Time Deposit, Post Office Recording Deposit, Post Office Monthly Income Scheme, National Savings Certificate (NSC) and Kisan Patra (KYP) , then the rate of interest will be in your entire plan period. However, the rate of interest on Public Provident Fund (PPF) and Sukanya Samriddhi Yojana will vary as the government changes.
In this article, we have written the interest rates for October-December 2019.
Post office savings account/ Post Office Savings Schemes
- The account is similar to a bank savings account only in the post office
- You can open only one account in a post office, which can be transferred from one post office to another.
- You can also open an account in the name of a minor. The interest rate is 4% and is taxed. Although income tax is not deducted
- However, under Section 80TTA of the Income Tax Act, 1961, the interest of your total savings account including post office savings interest is Rs 10,000. You can get taxis per year
Post Office Monthly Income Scheme (POMIS)
- This scheme guarantees you monthly income if the investor invests lumsam.
- Any residential person can open a single or joint MIS account. A minor can also invest in it. If the minor is over 10 years of age, he can also operate the account
- The minimum investment in a single holding account is Rs 1500. And a maximum of Rs 4.5 lakh. And the maximum limit in the joint account is 9 lakhs. is
- The duration of the scheme is 5 years with monthly benefits at an annual 7.6 % interest rate. Example: In the Suresh Post Office Monthly Income Scheme, Rs. 2 lakhs. Invest. He was given Rs 1300 as interest for five years. See you every month. At the end of the plan period they will get back the original investment. You can invest the monthly returns in a post office recurring deposit
- An investor can also open more than one account but the total amount in all is Rs 4.5 lakh. Should not be more than Under this scheme you can also open a joint account without going beyond the investment limit. Example: Mr. 2 lakh in Suresh single account 2.5 lakhs by opening a joint account with his wife. Can invest
- Under this scheme, the investor can withdraw his original investment after 1 year. But between 1 year to 3 years the original investment will have to be paid as a penalty of 2% of the investment and after 3 years the withdrawal is 1%.
- Accounts can be transferred from one post office to another across the country.
There is no major tax benefit in the plan. Income tax will also be charged on monthly interest. There is no TDS on interest and there is no wealth tax on investment. This scheme is offered to those investors who want to earn monthly income by investing even under risk.
Post Office Recreation Deposit (RD)
- The Post Office RD is a monthly investment plan that currently offers a 7.2 % annual interest rate (the interest rate will change every three months) and the plan period is 5 years.
- You can continue the scheme on yearly basis even after completion of the plan period in five years
- Investor in post office RD account Rs. 10 Can invest up to a month. There is no maximum investment limit
- Two adult joint accounts can also be opened. An account can also be opened in the name of a minor. Can open more than one account
- RD account can be transferred from one post office to another
- If you miss investing monthly then you will get Rs. 5 every month. But will have to pay a fine of 5 paise
- You can withdraw 50% of the investment after one year
There is also no TDS on RD. However, according to the tax slab of each person, earnings from RD are taxed. This is the best investment option for all those investors who want a monthly profit by investing without risk.
Post office time deposit/Post Office yearly Scheme
- There are a lot of period options for investing in post office time deposits. The available interest rates are below:
|Period||Interest Rate (January-March, 2019)|
- The minimum investment limit is Rs 200. Huh. There is no maximum limit. A person can open any number of accounts
- Both single holding and joint accounts can be opened. Minors can also invest
- Can transfer accounts from one post office to another across India
- After the deposit period is over, the account will automatically resume for the same period and the interest rate will remain the same
- There is a tax benefit on the investment made in a 5-year post office time deposit. These investments are eligible for claim of tax deduction under Section 80C of Income Tax Act, 1961 .
Post Office KVP Scheme/Post Office Kisan Vikas Patra Scheme
- In KVP you get an annual 7.6% compound interest rate. It can be purchased from any post office. Investment amount doubles every 112 months (9 years and 4 months)
- You can get Rs 1000, Rs 5000, Rs 10,000. And Rs 50,000. Can invest Minimum investment is Rs 1000. And there is no limit in maximum investment
- The certificate can be easily transferred and can be made to any third person.
- You can withdraw cash after 2.5 years of investment
- There is no tax on the principal amount invested. The interest charged on it comes under the tax net. Thus the scheme is not eligible for tax exemption. It works for new and small investors from remote areas who do not have access to other such investment options.
Post Office Senior Citizen Savings Scheme
- The minimum age to join this scheme is 60 years. People who take retirement on their own after the age of 55 can also open an account in it after one month of getting retirement benefits. The amount invested in such cases should not exceed the amount received by the person on retirement.
- Any person can open more than one account in his name or as a joint account (with spouse).
- Maximum per capita investment limit (including balance in all accounts) is Rs 15 lakh. is
- The current rate of interest is 8.6 % per annum, which will accrue on the first day of every quarter (every three months). The maturity period of the investment is five years. For example, if you get Rs 13 lakh in this scheme today. If you invest, you get Rs 24, 900 every quarter. Will benefit from
- Permission to withdraw funds before time will be possible only after one year. This will cut 5% of the investment amount and 1% after 2 years.
- After the completion of the plan period it can be extended for three years
- The investment made in the scheme is valid for tax deduction claim under Section 80C of Income Tax Act. However, tax will be levied only if the annual interest is Rs 10,000. Will be more than
Public Provident Fund (PPF)
- PPF is a long-term investment plan of 15 years. Which currently has an annual compound interest rate of 7.9 %
- There is no minimum or maximum age limit for joining this scheme.
- The minimum amount to invest is Rs 500. And the maximum annual amount is Rs 1.5 lakh. The amount invested can be deposited in one installment or at a time, but the installment limit should not be more than 12
- Can open single holding account only, joint account is not allowed
- You can also invest in the name of a minor while staying within your maximum investment limit.
- After the 15-year period is over, it can be extended for another 5 years. You can then increase it every five years in a row
- Closure of accounts is allowed only after five years of commencement of the scheme and the reason should be due to a serious problem or higher education. Five years after the launch of the scheme, some part of the invested amount can also be withdrawn by not closing the account.
- You can take a loan based on certain conditions from the funds deposited in your PPF account. The loan can be taken from the third year of the scheme to the sixth year.
- Under Section 80C of income tax, the amount invested in PPF can be claimed for tax deduction. Apart from this, the interest received on investment will also not be taxed. The interest earned on the deposit is tax-free, however, the interest earned from it has to be shown in the income tax return.
This is a good plan for investors who want a safe investment plan with tax exemption.
National Savings Certificate (NSC)
- The maturity period of NSC is five years. The rate of interest is 7.9 %, compound interest is paid every six months, which is only after the completion of the plan period. This means that your Rs 100,000. Investment of Rs. 144,231 in five years Will be done
- This scheme can be opened in single account or in the name of any minor.
- You get the benefit of tax exemption under the Income Tax Act 80C. Your TDS is not deducted by investing in National Savings Certificate
- NSC can be used as a guarantee for taking a loan
- You can transfer the National Savings Letter from one post office to another post office. You can transfer the certificate of National Savings Letter from one person to another, but only once in the whole period.
NSC is a long-term tax-saving risk-free scheme in which investors can invest without risk.
Post Office Sukanya Samriddhi Yojana
- Sukanya Samriddhi Yojana has been brought for the benefit of girls. It has an annual compound interest rate of 8.4 %
- There is a minimum of Rs 250 in a year. And a maximum of Rs. 1,50,000. Can be invested. After opening an account, you will have to deposit a minimum amount every year for 15 years. This amount will continue to interest every year
- Accounts opened under this scheme will be given a tax exemption of up to 1.5 lakhs annually under Section 80C of the Income Tax Act. There is no tax on the interest rate and maturity amount available on it.
- The account will be matured only when the daughter completes 21 years from the date of opening the account. If the girl’s marriage occurs after 18 years or before 21 years, the account will be closed after the date of marriage. The account will also be closed if the girl becomes an NRI or loses Indian citizenship. Deposits can be withdrawn along with interest after the account is closed
- Sukanya Samriddhi account can be opened only in the name of the girl child, which can be allowed by her parents or legitimate guardian. The girl’s age should be 10 years or less at the time of opening the account
- No more than one account can be opened in the name of a girl child. Parents / guardians can open two accounts in the names of two girls
- 50 for non-submission of annual minimum amount. Will be fined
- A girl can withdraw up to 50% of the amount deposited in the account when she is 18 years old.
- Under this scheme, parents / guardians will get tax benefits under Income Tax Act 80C on investment. On completion of the scheme, the girl will get the money, which will not be taxed.
This scheme is very famous, especially in rural India, which means that the scheme is providing financial security to the coming generation of women.
Question . I post office ‘s monthly income plan for how investment do ? Answer : The monthly income plan of the post office is a low-risk plan with a steady income. Any one can earn Rs 4.5 lakh per month. You can invest up to 7.7% and earn interest at 7.7% per year. To invest in a post office scheme, every person must have an MIS account. Any resident can open an MIS account either individually or jointly. The minimum investment for this scheme is Rs 1500. is.
Question . Do I have the post office to cash out could I ? Answer : Yes, money can be withdrawn from any post office from the post office account. Also, the account holder can withdraw money at any time, although in case of general account Rs. 50. Minimum balance has to be maintained.
Question . I Post Office ‘s account of how much money out could I ? Answer : Maximum of Rs 10,000 per day from post office account. Can be extracted up to. But, with the post office ATM card usage, Rs 25,000. Can be withdrawn per day.
Question . Do I own post office account online Czech tax could I ? Answer : Yes, the Indian Post Office enables its account holders to access their respective account details etc. using internet banking facility to register themselves under Net-Banking to have a valid personal or joint account with the customer, KYC Must have documented and active DOP ATM card.
Question . What Post Office ‘s investment safe and tax -free is ? Answer : Yes, it is secured as an investment under the post office bare sovereign guarantee of the Government of India. All these schemes are tax free to a certain extent and some schemes like PPF, Sukanya Samriddhi Yojana also have tax benefits on returns.
Question . What students in to a post office plans are ? Answer : Students above 18 years can avail all schemes except Senior Citizen Savings Scheme. Sukanya Samriddhi Yojana (SSY) is a scheme for girl students, in which parents have to deposit a specified amount of minimum maturity or above and when it turns 21, it is given to girls.