Small Savings Schemes of India Post Office

Small Savings Schemes of India Post Office:

(i) Kisan Vikas Patra
(ii) Post Office Monthly Income Account
(iii) 15 Years Public Provident Fund Account
(iv) Post Office Time Depost Account
(v) 5-Years Post Office Recurring Deposit Account
(vi) Post Office Savings Account
(vii) National Savings Certificate(VIII Issue)
(viii) Deposit Scheme For Retiring Govt. Employees-1989
(ix) Deposit Scheme For Retiring Employees of Public Sector Companies 1991

Post Office Monthly Income Account

Post Office Monthly Income Account

Scheme
Post Office Monthly Income Account

Interest Payable, Rates , Periodicity etc.
8% per annum payable i.e. Rs. 80/- will be paid every month on a deposit of Rs 12000/-. In addition 10% bonus is also payable on maturity i.e. Rs. 1200/- will be paid as bonus after 6 years for deposit of Rs. 12000/-.

Denominations & Investment limits
In multiple Rs. 1000/- Maximum Rs. 3 lakhs in Single account and Rs. 6 lakhs in joint account.

Salient Features Including Tax Rebate
Maturity period is 6 years. Can be prematurely encashed after one year at 3.5% discount. However, no such deduction shall be made if the account is closed after three years from the date of opening of such account. Interest & bonus deductible under Sec. 80-L of I.T. Act.

National Savings Scheme Certificate - Post Office Tax Savings - India

NATIONAL SAVINGS SCHEME CERTIFICATE VIII issue (NSC)

Name of the Scheme NSC VIII Issue
Interest 8.16%
Maturity Period 6 years
Limit of Deposit Min:Rs.100 Max: No Limit
I.T.benefit In the Union Budget 2005 the Tax benefit is given upto the deposit of Rs.1,00,000/-
Place of Deposit All Head Post Offices and authorised Post Offices

Who can Invest

An adult for himself or on behalf of a minor, jointly by two adults, a minor and a Trust.

How to Purchase

Certificate in denomination of Rs. 100, Rs.500, Rs. 1000, Rs.5000 & Rs. 10,000 may be purchased from any post office, either directly or through authorised agents. In addition to cash, locally executed cheque, pay order or demand draft in favour of the Post Master are also accepted.

Rate of Interest

Rate of interest is 8.16% p.a. compounded half yearly and paid after the maturity period of six years along with principal.

Annual accrual rate of interest on investment of Rs.100/- is as under and is in proportion for other denominations.

1st year Rs. 8.16
2nd year Rs. 8.83
3rd year Rs.9.55
4th year Rs.10.33
5th year Rs.11.17
6th year Rs.12.08

Encashment
Can be encashed after 6 years.

A certificate can be encashed at the post office at which it stands registered. A certificate may also be encashed at any other post office if the Officer –in –charge of that post office is satisfied on verification from the office of its registration that the person presenting the certificate for encashment is entitled thereto.

Tax Benefit

In the Union Budget 2005 the Tax benefit is given upto the deposit of Rs.1,00,000/-

Source: tnsmallsavings.com

Advantages of Post Office Monthly Income Scheme

Premature closure of the account is permitted any time after the expiry of a period of one year of opening the account. Deduction of an amount equal to 5 per cent of the deposit is to be made when the account is prematurely closed. Investors can withdraw money before three years, but a discount of 5%. Closing of account after three years will not have any deductions. Monthly interest can be automatically credited to savings account provided both the accounts standing at the same post office. The interest income accruing from a post-office MIS is exempt from tax under Section 80L of the Income Tax Act, 1961. Moreover, no TDS is deductible on the interest income. The balance is exempt from Wealth Tax.

Advantages of National Savings Certificate NSC

Tax benefits are available on amounts invested in NSC under section 88, and exemption can be claimed under section 80L for interest accrued on the NSC. Interest accrued for any year can be treated as fresh investment in NSC for that year and tax benefits can be claimed under section 88. NSCs can be transferred from one person to another through the post office on the payment of a prescribed fee. They can also be transferred from one post office to another. The scheme has the backing of the Government of India so there are no risks associated with your investment.