Senior Citizen Savings Scheme – Complete Details
Senior Citizen Savings Scheme – Senior citizen scheme is a better option if you want to take advantage of money security and tax savings along with regular income. This scheme is quite popular among those people who are above 60 years. After retirement, people are looking for such investment options where they can invest their deposits. People of this age avoid avoiding their money in equity because there is a risk of capital loss, in this case senior citizen scheme is considered a better option.
Senior Citizen Savings Scheme – Eligibility Criteria
- In this scheme, all those people who are 60 years of age or above can invest.
- Those people who choose the Voluntary Retirement Scheme (VRS) during the period of 55 years to 60 years can also invest in it.
- Except civil defense employees, retired defense personnel can also invest.
- Non-resident Indians (NRIs), Hindu Undivided Families (HUFs) are not eligible to invest in this scheme.
Senior Citizen Savings Scheme – Investment Procedure
People 60 years of age or older can open their own private or joint account by visiting a commercial bank or post office near them.
Senior Citizen Savings Scheme – How Much You Can Invest
- Any old aged person can open either by alone or jointly by depositing upto Rs. 15 lakhs (maximum) in his account under Senior Citizen Savings Scheme.
- This amount is minimum 1000 thousand rupees.
- This amount can not be more than the amount that the old person will get during retirement.
- According to the regulations recorded in the website of the Income Tax Department, the account can be opened under the senior citizen scheme by paying less than Rs 1 lakh in cash or by paying 1 lakh or more in the form of cheque.
How Many Acccounts Can be Opened Under Senior Citizen Savings Scheme
There is no limit to opening the account under this scheme. Any one can open any number of accounts, but this condition applies that the total amount deposited in all accounts should not exceed the maximum investment limit.
Senior Citizen Savings Scheme – Required Documents
- A fully filled form that is available in the post office or the bank.
- KYC Form
- Applicant’s photo
- Applicant’s PAN Number
- Copy of residence certificate
- Age certificate
- In the context of retirement, the certificate issued by the employer in this context
Once the account is opened under the Senior Citizen Savings Scheme, a passbook is issued by the bank or post office, in which the account opening date, account number, name of the depositor, his photograph, address and the amount deposited is mentioned. Also, the interest paid on quarterly basis is also mentioned on that passbook.
Senior Citizen Savings Scheme – Interest Rate
In the senior citizen savings scheme, interest is given at 8.5 percent per annum. It is also reviewed by the Finance Ministry in every quarter. However, there is no option like compound interest on FD.
Senior Citizen Savings Scheme – Investment Period
The maximum period of this savings plan is 5 years. However, after maturity, the term can be extended once to 3 years. The withdrawal of this account is permitted before time. But this can only be done after a period of one year.
Saving in Tax
Investments in the Senior Citizen Savings Scheme (SCSS) account is tax saving as per the provisions of Section 80C of the Income Tax Act, 1961. However, under Section 80C of the Income Tax Act, the maximum limit for receiving tax rebate benefits under this scheme is 1.5 lakh per year.