Like banks, post office also runs many savings schemes in India. Including Post Office Savings Scheme. The question is, what is Post Office Savings Scheme? Let us tell you that today we are going to tell you all the important schemes related to Post Office Savings Scheme and the process of application through this article. If you want to know all the important information related to Post Office Savings Scheme then you are requested to read this article till the end.
What is Post Office Savings Scheme
You must have heard the name of India Post. India Post controls the postal chain of the country. But apart from controlling the postal chain, India Post also runs several deposit saving schemes for investors. Which we know as Post Office Savings Scheme or Post Office Savings Scheme. Investing in Post Office Savings Scheme offers investors high interest rate as well as tax benefits. Tax exemption is given under section 80C of the Income Tax Act. The post office runs several savings schemes. Like Public Provident Fund, Sukanya Samriddhi Yojana, National Saving Certificate etc. We will tell you about all these schemes in this article.
Purpose of Post Office Savings Scheme
The main objective of the Post Office Savings Scheme is to promote the spirit of savings among the people. For this, the government has made a provision of high interest rate as well as tax exemption for investors investing in Post Office Savings Scheme. This scheme will make the investors financially strong. There are not one but many schemes in the Post Office Savings Scheme, which have been started keeping in mind all the sections of the people. An attempt has been made to plan something for all sections of the people. So that people invest in maximum post office savings scheme.
Post Office Savings Schemes
1. Post Office Recurring Deposit
It is basically a monthly savings scheme for five years which offers interest at the rate of 7.3% per annum, which is compounded quarterly. The scheme allows the smallest investment of Rs.10/month and any amount, but there should be no upper limit of investment in multiples of Rs.5. This Post Office Savings Scheme charges 5 paise for every 5 rupees you miss on monthly investment. One can withdraw up to 50% of the amount available in his RD account after one year of investment.
2. Post Office Savings Account
Thus the account works like savings accounts of banks, with the difference that it is held with the post office. However, a person can open only one account in one post office but can transfer one account from one post office to another. The interest rate available with this account is 4% and it is fully taxable without any TDS deduction.
3. Post Office Post Office Time Deposit Scheme
The minimum amount to be invested in this scheme is Rs 200 with no upper limit. Also, there is no restriction on the number of accounts under this plan. An account holder can transfer his account from one post office to another and there is facility of joint account also. Tax benefit is provided on investments made for five years under Section 80C of the Income Tax Act.
4. Post Office Monthly Scheme Account (MIS)
It is a unique scheme that provides fixed monthly income on the investments made by the investors. Any Indian resident can open an account under this scheme as an individual account holder or jointly. This account can be opened for a minor also and if the age of the minor is more than 10 years then he can operate his own account also.
5. Senior Citizen Savings Scheme
The minimum age to take this Post Office Senior Citizen Savings Scheme is 60 years. Anyone who has taken voluntary retirement after the age of 55 years is also eligible to open this account within the month in which he starts receiving retirement benefits. The investment amount in this plan should not exceed the corpus value to be received on retirement. Any individual can open a joint SCSS account with his/her spouse.
6. General Provident Fund
It is a long-term investment scheme with an investment tenure of 15 years and it currently offers 8% interest per annum. which is added on an annual basis. The minimum investment in your PPF account is Rs 500 which can go up to Rs 1 lakh 50 thousand in a financial year. Investment can be made in lump sum or in equal installments for 12 months. The maturity period of PPF account is 15 years and it can be extended in five years on completion of 15 years.
Benefits and Features of Post Office Savings Scheme
- People will be motivated to save money by investing in Post Office Savings Scheme.
- Saving money will improve the financial condition of the directors.
- It is very easy to apply for this scheme.
- Very few documents are required to apply for Post Office Savings Scheme.
- Post Office Savings Scheme is a long term investment scheme.
- The interest rates in this post office savings scheme range from 4% to 9%.
- Post Office Savings Scheme is a government scheme which is completely risk free.
- Investing in Post Office Savings Scheme provides tax exemption to the investor under Section 80C of the Income Tax Act.
- Different types of schemes have been kept for all classes of people.
Post Office Savings Scheme Application Process
If you want to apply in Post Office Savings Scheme then follow the procedure given below:
- First of all you have to go to your nearest post office.
- Now for whichever scheme you want to apply, the form will have to be taken from the post office.
- Now you have to fill all the information asked in the form carefully like name, address etc.
- All necessary documents must be attached.
- Now you have to submit this form back to the post office.
- In this way you can apply in Post Office Savings Scheme.
- To get more details about Post Office Savings Schemes, visit the official website indiapost.gov.in