Post Office MIS 2026: Money tension ends after retirement, on depositing ₹ 15 lakh, you will get guaranteed interest of ₹ 9,250 every month; Know all the rules

Having a secure and guaranteed income source without any market risk to handle regular monthly expenses becomes the biggest priority after retirement. The Post Office Monthly Income Scheme (POMIS) has emerged as an excellent option for senior citizens and conservative investors who are away from the ups and downs of the stock market or the risks of mutual funds. The biggest feature of this scheme is that your principal amount is 100% protected with the sovereign guarantee of the Government of India and every month a fixed interest is credited directly to your bank or savings account. If you invest a lump sum of ₹15 lakh in this scheme along with your spouse, you get a fixed pension-like income of ₹9,250 every month for the next 5 years.

Post Office Monthly Income Scheme (POMIS) is a small savings scheme supported by the Ministry of Finance, Government of India. The maturity period of this scheme has been fixed at exactly 5 years (60 months). Currently, interest is being given in the scheme at the rate of 7.4% per annum. This interest is not cumulative, but is sent to the investor’s account every month in the form of simple interest. This means that your principal amount remains intact and the interest earned on it remains available to meet your monthly needs. After completion of 5 years tenure your entire principal amount is returned back to you.

As per post office rules, monthly interest is calculated using the simple interest formula: $\text{Monthly Interest} = \frac{\text{Principal} \times \text{Annual Interest Rate}}{12}$. When a joint account holder family deposits the maximum limit of ₹15 lakh, the math works like this:

Thus, a total interest of ₹5,55,000 is earned on an investment of ₹15 lakh over a period of 5 years and the entire ₹15 lakh is safely withdrawn on maturity.

Any Indian citizen can open an account in Post Office Monthly Income Scheme individually or jointly. Investment in this can be started with a minimum of ₹ 1,000. The government has set clear guidelines regarding maximum investment limit:

• Single Account: An individual can invest a maximum of ₹9 lakh in his/her name.

• Joint Account: A maximum of 3 adults can open a joint account, in which a total of up to ₹15 lakh can be deposited. In a joint account, the stake of all the account holders is considered equal.

• Account in the name of minors: An account can also be opened by a guardian in the name of a minor above 10 years of age, with a separate limit of up to ₹ 3 lakh. Note that an individual can maintain multiple MIS accounts in different post offices, but his total individual deposit limit across all accounts combined cannot exceed ₹9 lakh.

Although the maturity period of the scheme is 5 years, the facility of premature closure of the account is also given for emergent financial needs. However, there are some penalty rules for this:

1. Within 1 year of account opening: Withdrawal of principal amount or closure of the account is not permitted under any circumstances.

2. Withdrawal between 1 year to 3 years: If the account is closed after completion of 1 year and before 3 years, the remaining amount is returned after deducting an amount of 2% from the total principal deposited.

3. Withdrawal between 3 years to 5 years: On closing the account after completion of 3 years, 1% is deducted from the principal amount. On premature closure, no deduction is made from the monthly interest you have already received, only a prescribed percentage is deducted from the principal amount.

The interest received in Post Office Monthly Income Scheme is fully taxable. This interest is added to the total annual income of the investor and is taxed as per his applicable income tax slab. However, in this scheme, no tax is deducted at source (No TDS) by the post office, provided the investor shows it in his Income Tax Return (ITR) under ‘Income from Other Sources’. In this scheme, there is no tax exemption on the investment amount under Section 80C. To receive monthly interest, the investor has to open a savings account in the same post office, where the interest amount is automatically transferred (ECS / Auto-Credit) on the fixed date of every month. If the investor wishes, he can also avail compounding benefits by getting that interest auto-debited into the Recurring Deposit (RD) account of the post office.

Both offline and online processes for opening MIS account in post office are very simple:

1. Visit your nearest post office branch and collect the POMIS Account Opening Form (Form-1).

2. Enter your personal information, details of joint account holders (if applicable) and name of the nominee correctly in the form.

3. Enclose a self-attested copy of your PAN Card and Aadhar Card as identity proof and address proof.

4. Attach recent passport size color photograph and copy of post office savings account passbook.

5. Deposit the prescribed investment amount through check or draft. Once the account is activated, you will be issued an MIS passbook, which will record the amount deposited, monthly interest rate and monthly payment date. This scheme is best suited for all those senior citizens and retired workers who want a fixed and respectable income every month without any mental stress.