Post Office SCSS: Interest rates, minimum investment, returns, maturity and other details

Post Office Senior Citizens Savings Scheme (SCSS) 2024: Do you know that you can deposit money in designated post office branches for multiple benefits? India Post, which has a network of over 1,55,000 post office branches spread across the country, offers a suite of government-backed savings schemes, known as Small Savings Schemes. Out of a total of 13 types of small savings schemes, the two schemes that offer the highest rates of return are Senior Citizens Savings Scheme (SCSS) and Sukanya Samriddhi Account.

Rate of interest

For the last three months of the current financial year, which ends March 31, the Senior Citizens Savings Scheme offers interest at 8.2 per cent per annum.

minimum investment

Eligible individuals can set up a Senior Citizens Savings Scheme account at designated post office branches by making a minimum payment of Rs 1,000.

maximum investment

To open an account, one can deposit a lump sum amount up to Rs 30 lakh in multiples of Rs 1,000.

What happens if the depositor exceeds this limit?

Any excess deposited is immediately refunded with interest at the rate applicable to Post Office Savings Account. This interest is calculated from the date of additional deposit till the date of refund.

eligibility criteria

Who can open Senior Citizens Savings Scheme (SCSS) account? All persons aged 60 years and above can open the account individually or jointly with spouse. Additionally, the following individuals can also open an account first:

Retired civilian employees above 55 years of age and below 60 years of age, subject to the condition that the investment is made within one month of receipt of retirement benefits.

Retired defense personnel above 50 years of age and below 60 years of age, subject to the condition that the investment is made within one month of receipt of retirement benefits.

interest payment

Interest is payable for the first time from the date of deposit till 31st March, 30th September or 31st December and thereafter on 1st April, 1st July, 1st October and 1st January.

Interest is calculated every quarter and is applicable from the date of deposit till 31st March, 30th June, 30th September or 31st December.

premature closure

There is no lock-in period on the account, which means deposits can be closed anytime after account opening. However, certain rules apply to deposits made before five years of opening:

If the account is closed before one year, no interest is payable; Any interest paid into the account is recovered from the principal amount

If the account is closed after one year but before completion of two years from the date of opening, an amount equal to 1.5 percent of the principal amount is deducted.

If the account is closed after two years but before completion of five years, an amount equal to 1.0 percent of the principal amount is deducted

An extended account can be closed after the expiry of one year from the date of extension without any deduction

Are SCSS returns taxable?

If the total interest in all SCSS accounts exceeds Rs 50,000 in a financial year then the interest amount is taxable. In such cases, Tax Deducted at Source (TDS) is applicable on the total interest earned.

However, if interest income is reported in Form 15G or 15H as per income tax laws, no TDS is deducted.

Do you know that Senior Citizens Savings Scheme and Sukanya Samriddhi Account offer the highest returns among various small savings schemes?

List of interest rates applicable on Senior Citizens Savings Scheme and other small savings schemes for the quarter ending March 31, 2024