Scheme specially designed for Income Tax assesses. Safe investment option with guaranteed returns.
NSC Certificates can be kept as collateral security to get loan from banks
The deposit up to Rs. 1.5 Lakhs qualify for tax deduction under Section 80C of Income Tax Act.
Under the old system the yearly interest accrued needs to be declared as “Income from other sources”.
Yearly interest accrued is considered to be re-invested under Section 80C of Income Tax Act and hence eligible for tax deduction.
Under the new System deposit amount won’t get any deduction benefit under section 80C of IT Act. Yearly interest accrued to be declared as “Income from other sources”
An adult for himself/ on behalf of minor/ minor aged 10 years/jointly up to 3 adults can buy these certificates.
Minimum deposit amount is Rs. 1,000. No maximum limit.
Maturity 5 years. Earlier tenure was 10 years but dis-continued wef 20.12.2015.
Current annual interest rate is 6.80% yearly compounding. Govt to announce fresh rates on quarterly basis.
From 01-July-2016 onwards Government has discontinued the physical certificates. NSCs are issued in Passbook format.
NSC certificate allowed as a collateral security to get Loan from the Banks.
Scheme suitable for those who expect to receive regular and guaranteed income on a monthly basis.
Not eligible for deduction under Section 80C of Income Tax Act. No TDS.
An adult for himself/ on behalf of minor/ minor aged 10 years/jointly up to 3 adults can buy this Scheme.
Operated through Post Offices.
Minimum Rs. 1,000. Maximum deposit limit is Rs. 4.5 lakhs for Single & Rs. 9 Lakhs for a joint account.
Tenure is 5 Years.
Current interest is 6.60% monthly which will remain the same till maturity. Govt to announce fresh rates on quarterly basis.
Monthly interest is paid through an auto-credit facility into savings accounts present at the same post office.
Premature closure allowed after one year.
Penalty: Before 3 years: 2% of the Deposit Amount
After 3 Years: 1% of Deposit Amount.
Single account can be converted into Joint account and Vice Versa. Minor after attaining majority has to apply for conversion of the account in his name.
NRI (Non Resident Indians) and HUF (Hindu Undivided Family) can NOT open the account.
PPF is a long term Savings Scheme by GOI, tax deductible investment with attractive returns that are fully exempted from Income Tax.
An individual resident can open a PPF account for himself/on behalf of a minor. Individuals can have only one PPF account under his name either in the Post Office or Bank. Joint accounts are not allowed.
HUF can’t open a new PPF account wef 13.5.2005. Accounts opened before 13-May-2005 can be continued till maturity.
NRI (Non Resident Indian) are not eligible to open a new PPF account.
Minimum deposit Rs. 500 & Maximum is Rs. 1.5 Lakhs.There is no limit on the number of installments in a month or financial year.
Maximum deposit limit is for both individual self account and account of minors whom he is the guardian, taken together.
Best time to deposit money in PPF is 1st to 5th of every month
Deposit upto Rs.1,50,000 per FY qualify for deduction under Section 80C. Interest earned and maturity are tax free and exempt from wealth tax. Under the new System amount deposited does not qualify for tax rebate.
Account will become in-active if a minimum of Rs. 500/- is not deposited during a financial year.
Can re-activate the account by paying a penalty of Rs. 50 for each financial year of default and the minimum deposit amount of Rs. 500 for each financial year of default.
Current interest rate is 7.10% compounded annually. Interest is reset by the Government on a quarterly basis wef 01-Apr-2016.
Maturity period is 15 full financial years.Can be extended even after the maturity period. The extension can be with deposit or without deposit.
Account holders can continue to withdraw every financial year. One withdrawal is allowed per financial year. No limit on the withdrawal amount. Amount remaining in the account will continue to earn interest till it is fully withdrawn.
In case of extension without deposit one withdrawal is allowed every financial year without any limit on the withdrawal amount.
Extension with deposit to be for a block of 5 financial years. There is no limit on the number of blocks.
During the extended period one withdrawal allowed every financial year. Total withdrawal during the extended 5 year block should not exceed 60% of the account balance at the start of the extension period.
Loan facility available from 3rd to 6th Financial Year of opening the account. In-active accounts do not qualify for loans. Eligible loan amount is 25% of the account balance at the end of 2nd FY immediately preceding the year in which the loan is applied for.
Loan principal amount to be repaid within 3 years from the first day of the month following the month in which the loan was sanctioned.
Once the principal amount is fully repaid then interest to be repaid within 2 monthly installments.
If loan is partly paid or not paid within the 3 years, then the outstanding loan principal amount will be charged at 6% per annum above the applicable PPF interest rate.
One withdrawal is allowed per financial year from the 7th financial year of opening the account.
Withdrawal limited to 50% of the account balance standing at the end of 4th financial year immediately preceding the financial year of withdrawal
OR
Balance at the end of the preceding financial year, whichever is lower.
Premature Closure allowed in following situations:
Medical treatment of life threatening disease of self/spouse/dependent children/parents.
Dependent children’ higher education in a recognised institute of higher education in India or abroad
Premature closure is allowed for the accounts that have completed 5 financial years from the end of the financial year in which the account was opened. It means that premature closure is allowed from the 7th financial year of account opening.
Premature closure to attract Penalty of interest to be calculated at 1% lesser than the interest rate applicable to the scheme from time to time since the date of account opening.
KVP Certificate can be purchased from a Post Office under which the amount gets doubled in 10 years and 4 months. Scheme was discontinued back in 2011 but relaunched in November, 2014.
An adult for himself/ on behalf of minor/ minor aged 10 years/jointly up to 3 adults can buy these certificates.
NRI (Non Resident Indians) and HUF (Hindu Undivided Family) can not purchase KVP certificates.
Minimum Deposit amount Rs. 1,000. No maximum limit.
Currently, the maturity period is 10 years and 4 months. Maturity period is not fixed and it changes from time to time based on notification from the Government.
Current interest rate is 6.90% per annum. Interest rate on the day of account opening will remain the same throughout the tenure of KVP.
Interest is compounded on yearly basis wef 01-Apr-2016 onwards. Note that it used to be on half-yearly compounding earlier.
Physical Certificates used to be issued earlier but from 01-July-2016 onwards, the Government discontinued the physical certificates instead, one gets the option to keep KVP in the following formats:
e-mode (Online Mode)-view the details of purchase Online. For this facility investor to have a Savings Bank (SB) Account and Internet Banking facility
Passbook mode-This is similar to the Savings Bank Pass Book. After purchasing KVP, the entries are made (either printed or manually) in the passbook.
Deposit amount not eligible for tax deduction under Section 80C of Income Tax Act. Interest received on maturity is taxable.
No TDS (Tax Deducted from Source) on maturity.
Certificate can be pledged as a security to get loan from Banks
Scheme can be closed prematurely after two and a half years from the date of issue.
Sukanya Samriddhi Account is a savings scheme by GOI which aims at the education and marriage of a Girl child. Scheme was launched on 22.1.2015
Account can be opened in a Bank or Post Office.
Age of the girl child should be less than 10 years at the time of account opening.
Parents or legal guardians operate the account till the girl child reaches 18 years of age.
Maximum of 2 accounts can be opened in the name of two different girl children.
One can open more than two accounts if blessed with more than 2 girl children on the first birth.
Can also open more than two accounts if blessed with 2 or more girl children on the second birth provided had only one girl child on first birth.
Minimum- Rs. 250 Maximum- Rs. 1.5 Lakhs every year for the first 15 years.
Need not deposit from 16th to 21st year ie 16th, 17th, 18th, 19th, 20th and 21st
Maturity on completion of 21 years from the date of opening.
Entire balance can be withdrawn if the girl child gets married before the completion of 21 years.
Deposit of Rs. 1.5 Lakhs eligible for tax deduction under Section 80C. Interest earned and maturity amount is completely (100%) tax free.
Account becomes an “in-active” account if a minimum of Rs. 250/- is not deposited and one has to pay a penalty of Rs. 50 for each year of default and minimum deposit amount of Rs. 250 for each year of default.
Current interest rate – 7.60% yearly compounding,hich is subject to revision on a quarterly basis.
Deposit period is for the first 15 years. One need to deposit every year from the account opening date till the completion of 15 years
Maturity period is 21 years from the date of opening. The girl reaching the age of 21 years has no relevance to the maturity of this scheme.
After 15 years, the account keeps earning yearly compounded interest for the remaining 6 years (that is 16th, 17th, 18th, 19th, 20th and 21st years).
The deposit period was 14 years when the scheme was launched but was extended to 15 years in March,2016.
If the girl gets married before the maturity period of 21 years but after attaining age of 18 years, prematurity is allowed.Requests to be made to the Bank/Post Office to close the account a month before marriage or within 3 months after marriage.
One has the option to keep the account open beyond marriage till the completion of 21 years from account opening date.
Partial Withdrawal allowed for education purpose when girl reaches 18 years of age or on completion of 10th standard, whichever is earlier:
Maximum of 50% of the balance standing at the end of the financial year just before the year of withdrawal
Actual “admission fees” or “fee slip” to be paid to the educational institution
On death of girl child account gets closed and balances along with interest, till the date of death is paid to the parent or guardian of the girl child.
In case of extreme difficulties in maintaining account for reasons such as life threatening diseases to the girl child or death of the parent or guardian, then the concerned Bank or Post Office can allow pre-closure subject to sufficient documentation.
Premature closure is allowed only after completion of 5 years from the date of account opening. In this case, the entire account balance along with interest, till the date of closure, will be paid to the girl child or parent.
