Post Office Schemes: Tax exemption under 80C is not available on 5 post office schemes, know details

 

Post Office Schemes: Tax exemption under 80C is not available on 5 post office schemes, know details

Post Office Scheme: Most people invest in many post office schemes thinking that they will get tax benefits. But let us tell you that there are many such schemes of Post Office on which you do not get any kind of tax benefit.

Post Office Scheme: Most people invest in many post office schemes thinking that they will get tax benefits. But let us tell you that there are many such schemes of the post office on which you do not get any kind of tax benefit. Some post office schemes do not come under tax exemption category under 80C. There is no tax on the interest received on some schemes.

Those schemes on which tax benefit is not available under section 80C.

  • Kisan Vikas Patra (KVP)
  • Post Office FD (except 5 years period)
  • Post Office Monthly Scheme
  • Women’s Equal Savings Certificate
  • Post Office Recurring Deposit

1. Mahila Samman Saving Certificate – Mahila Samman Certificate 2023 is a small savings scheme brought by the Government of India for women. It inculcates the habit of saving and investing money among Indian women. Tax benefits are not available under the scheme. You can avail tax exemption under 80C but the interest is taxable.

2. National Savings Time Deposit (TD) can be opened for one, two, three or five years. You can also increase its time period. The interest rates offered for 1 year, 2 years and 3 years are 6.9%, 7.0% and 7.1% respectively. You can avail tax benefits on 5 years time deposit in National Savings Time Deposit. 80C is not available on deposits of one year, two years or three years.

3. National Savings Recurring Deposit (RD) Guarantee gives interest of 6.7 percent. There is a lock-in period of five years. Interest is compounded on quarterly basis. One person or maximum 3 people can open a joint account. The RD account holder has to deposit a minimum of Rs 100 or in multiples of Rs 10 in a month. There is no limit on maximum deposit.

4. There is no exemption under 80C in Kisan Vikas Patra Scheme. Tax has to be paid on the returns received on this. Interest on this is available annually.

5. A single person can invest a maximum of Rs 9 lakh in the Post Office Monthly Income Scheme. A maximum of Rs 15 lakh can be invested in a joint account. Tax is levied on the interest received on this. There is no exemption under 80C on this scheme. Interest income comes under the category of taxable income if it exceeds Rs 40,000 in a financial year and Rs 50,000 for senior citizens. The government is giving 7.4 percent interest on it.

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