With long term saving options and unmatched security and features that are usually associated with any government sponsored savings programSenior Citizen Saving Scheme was launched in 2004. Interest is paid as per the rate declared by Government of lndia from time to time. Present rate of interest is 8.3% p.a. w.e.f. 01.07.2017.
Tenure extends upto 5 years and upon maturity can be subsequently extended for an additional 3 year ₹ The depositor is allowed to make one deposit into this account, an amount that is a multiple of ₹ 1,000 but not extend beyond ₹ 15 lakhs. SCSS accounts are safe, highly targeted and a long term savings prospect for senior citizens . Instead of parking their savings in the low yield savings bank accounts or risky propositions the senior citizen saving schemes offer the Indian senior population the option to INVEST in a safe, high yielding and popular savings portfolio.
In order to invest in the saving scheme for senior citizens in India, said applicant must be aged 60 years or above.. Also, the invested amount must not exceed the amount of the retirement benefits.
In case of a joint account, the eligibility is decided per the mentioned age requirements of the primary depositor. There is no age restrictions/requirements imposed on the second applicant.
In certain conditions, individuals in the age group of 55 years and above can also apply successfully.
Only one deposit is permitted per SCSS account. The deposit must be in multiples of ₹ 1,000 with a maximum permissible investment of ₹ 15 lakhs.
Interest on the money accumulated in the SCSS account is payable on 31st March/30th September/31st December in the first instance and thereafter interest is payable as of 31st March, 30th June, 30th September and 31st December of each year.
Maximum tenure of this saving scheme is 5 year ₹ However, after maturity, the tenure can be extended for a further 3 year ₹
An applicant can operate multiple accounts simultaneously, individually or with a joint account holder who is the spouse. However, the account holder must ensure that all requirements pertaining to the validity and operation of these accounts must be met, including maintaining the minimum balance.
It must be noted that cash is an acceptable medium of investment if the initial amount is less that ₹ 1 lakh. If this amount is larger than ₹ 1 lakh then a cheque must be used.
Account can be easily and quickly transferred from one bank/post office onto another.
SCSS provides nomination facility that can be availed at the time of opening the account or after said account has been in operation for a set duration of time.
If the depositor chooses to terminate the account prematurely then the following penalty applies- 1.5% of deposit amount after one year and 1% of the deposit amount after two year ₹ Kindly note that premature closure of the senior citizen saving scheme account is only possible after the account has been in operation for a minimum of one year.
In case of joint accounts, the primary account holder is deemed the investor while the second stakeholder must be the primary account holder’s spouse.
Tax is deducted at source if the accumulated interest on the INVESTED amount exceeds ₹ 10,000 per annum.
Accumulated interest is deposited onto a designated savings account, maintained at the bank/post office, wherein the senior citizen saving scheme is maintained. These deposits are done through the auto credit facility via money orders or PDCs.
Investments in the SCSS account saves tax as per the provisions laid out in Section 80C of the Income Tax Act, 1961.