SCSS Calculator: Earn Over Rs 10 Lakh Interest Income From Senior Citizen Savings Scheme; Interest Rate To Tax Benefits - Top 10 Facts

 

Earn Over Rs 10 Lakh Interest Income From SCSS

SCSS Calculator: The Senior Citizens Savings Scheme (SCSS) is a savings option for individuals aged 60 or older with some exemptions on age. SCSS is a small savings scheme and the SCSS account can be opened at any post office or bank near you. Senior Citizens Savings Scheme is a very popular investment option because it is backed by the government and hence considered safe. But how much interest income can you earn from SCSS? What are the tax benefits of SCSS and the maximum allowed investment? How much quarterly income can senior citizens expect? We take a look at top 10 facts about the Senior Citizens Savings Scheme: (AI image)

Senior Citizen Savings Scheme Interest Rate

SCSS Interest Rate: For the April-June 2024 quarter, the interest rate for Senior Citizen Savings Scheme stands at 8.2% per annum. The interest rates for small savings scheme, including Senior Citizen Savings Scheme, are assessed on a quarterly basis by the Ministry of Finance. (AI image)

Senior Citizen Savings Scheme Calculator

SCSS Calculator: At the current interest rate of 8.2% per annum, the maximum investment of Rs 30 lakh will earn a quarterly interest of Rs 61,500/- and over a period of 5 years, you will have a total interest earning of Rs 12,30,000/- (AI image)

Senior Citizen Savings Scheme Interest Payout

SCSS interest is paid quarterly, starting from the date of deposit to the end of March, June, September, and December for the first time. Subsequently, it's payable on the 1st of April, July, October, and January. If an account holder does not claim the interest payable each quarter, the unclaimed interest will not accrue additional interest. (AI image) 

Who Can Open Senior Citizen Savings Scheme?

SCSS Eligibility: Individuals above 60 years of age are eligible to open an SCSS account. Additionally, retired civilian employees aged between 55 and 60, and retired defence employees aged between 50 and 60, can open an account within one month of receiving retirement benefits. Joint accounts can only be opened with a spouse. (AI image)

SCSS Minimum and Maximum Deposit Limit

Senior Citizen Savings Scheme has a minimum deposit of Rs 1,000/- and deposits can be made in multiples of Rs 1,000/-. There shall be only one deposit in the account. SCSS allows deposits up to Rs 30 lakh, as announced in the 2023 Budget. In the case of an excess deposit, it is immediately refunded to the depositor. (AI image)

Senior Citizen Savings Scheme Tax Benefits

SCSS Tax Benefits: Investments in Senior Citizen Savings Scheme qualify for tax benefits under Section 80C of the Income Tax Act, 1961. Interest becomes taxable if the total interest across all SCSS accounts exceeds Rs 50,000 in a financial year, with TDS deducted at the prescribed rate. However, no TDS is deducted if Form 15G/15H is submitted, and the accrued interest does not exceed the prescribed limit. (AI image)

Senior Citizen Savings Scheme Extension

SCSS Extension: Account holders can extend the account for an additional three years from the date of maturity. The extension must be applied for within one year of maturity, and the extended account will earn interest at the prevailing rate. Extended accounts can be closed without deductions after one year from the extension date. According to an ET report, as per the latest SCSS rules, the account can now be extended in blocks of three years multiple times, instead of just once earlier. (AI image)

Senior Citizen Savings Scheme Maturity and Closure

SCSS account can be closed after five years by submitting the prescribed application form at the post office. In case of the account holder's demise, the account earns interest at the prevailing Post Office Savings Account rate. If the spouse is a joint holder or sole nominee, the account can be continued till maturity if they are eligible and don't hold another SCSS account. (AI image)

SCSS Premature Closure

The Senior Citizen Savings Scheme account allows for early closure at any time, with varying deductions based on the closure period. If closed within one year, no interest is paid, and any interest received is deducted from the principal. Between one to two years, a 1.5% deduction applies, and between two to five years, a 1% deduction applies. (AI image)

How To Open An SCSS Account

To open a Senior Citizen Savings Scheme account, fill out the application form, nomination form, and provide necessary KYC documents (PAN and Aadhaar), photos. You can have multiple SCSS accounts, but the total deposit in all accounts shouldn't exceed Rs 30 lakh. (AI image)