This is a central government saving scheme meant for the people above 60 years of age. It provides a regular source of income with higher safety and tax benefits. This is completely a market risk-free scheme that provides interest as a regular source of income during the tenure of the scheme.
Eligibility to invest in SCSS:
1. Every senior citizen who has acquired the age of 60 years or above on the date of joining this scheme.
2. Any person who got voluntary retirement or retired under superannuation or otherwise and attained the age of 55 years or above but less than 60 years.
3. Any retired Defence personal excluding civilian Defence employee, who attained the age of 50 years can also subscribe to this scheme upon providing relevant documents.
4. The account can be opened single or jointly.
Documents Required:
1. An application form available at the post office.
2. A valid identity proof issued by the govt of India.
3. A valid address proof.
4. One photograph.
Features of the SCSS:
1. Interest rate: current rate is reduced to 7.4 % and this interest is calculated quarterly and it is deposited into the account holder saving bank account by itself provided he has submitted the saving bank account details. If the depositor forgets to withdraw his interest for any quarter then such interest will not earn any additional interest.
2. Deposits: minimum deposit is 1000 and maximum up to Rs 15 lakhs. Deposits can be only in the multiples of 1000 only. If there will be an excessive amount more than the maximum limit than the excess amount will earn the normal saving interest as per the post office or bank where the account is opened. Up to 1 lakh amount can be deposited in cash but above that only cheques are allowed.
3. Account flexibility: Multiple accounts can be opened single or jointly but the total deposits in all the accounts must not be more than the maximum limit.
4. Maturity period: 5 years.
5. Withdrawal: the amount deposited at the time of opening will be returned to the account holder on the submission of the passbook issued at the time of opening only when the account acquired maturity or after the date of maturity.
6. Extension facility: The scheme can be extended after the maturity further for three years with a new interest rate of that time.
7. Nomination: This facility is also available to this account. In case of death of the depositor before the maturity than the deposit along with the interest up to the date of the depositor death will be given to the nominee or legal heir on producing certain documents. If there will be a delay in getting the deposit by the nominee after the date of death then also the amount will earn interest as per the saving account.
8. Premature withdrawal: the account can be closed at any time before the maturity period under certain conditions.
a. If the account is closed before one year under any emergency then the deposit will not earn any interest and the interest already paid will be recovered from the principal amount.
b. If the account is closed after one year but before the completion of the second year the amount equal to 1.5 % of the deposit will be deducted and the balance amount will be given to the depositor.
c. If the account is closed after the expiry of two years then 1% of the deposits will be deducted and the balance amount will be given to the depositor.
d. The account holders who are in the extension period of 3 years are permitted to withdraw amount without any deduction after the completion of 1 year of the extension.
9. Transfer of the account: The account can be transferred from the branch of post office or bank where the account was opened to any other branch across India
10. NRI or HUF’s: The peoples under these categories are not allowed to open any fresh account but if the account holder acquired this status after the opening of the account then the account will continue based on Non-Repatriation mode until maturity and will be marked Non-resident account.
11. Tax benefits: investment up to 1.5 lakh is tax-free under 80C, above this, there are no other tax benefits.
12. Power to relax: if the depositor feels any kind of hardship in fulfilling all the regulations of this scheme and the central government is satisfied with his condition then it may relax the requirement of that provision not inconsistent with the provision of the act. This will be by order or for reasons submitted by the depositor in writing.
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