SCSS– Planning for investment on something? Then this article is made for you. After retirement from the job, the biggest problem for the elderly is regular income. If the amount received at the time of retirement is invested in the right scheme, then regular income can be obtained from it. In this case, the government’s Senior Citizen Savings Scheme (SCSS) is proving to be a great option.
After increasing the investment limit in Budget 2023, the shine of this scheme has increased further. The elderly are investing heavily in this scheme for regular income.
Who can invest?
Senior Citizen Savings Scheme is only for those people who are 60 years of age or above. People who have availed Voluntary Retirement Scheme (VRS) and are not working can invest in this scheme at the age of 55 years. People who have served in the defense sector can join this scheme after 50 years.
People who are retiring before 60 years can open this account within one month of receiving the retirement amount. You cannot invest more than the amount received at the time of retirement in this account. The account can be opened individually or jointly with husband and wife.
How much interest will you get
Compare schemes with fixed returns Senior Citizen Deposit Scheme is currently offering the highest interest rate of 8.2% per annum which is higher than the five year FD of government banks. The duration of this scheme is five years which can be extended for another three years. A person can deposit a maximum of Rs 30 lakh in this scheme. If you deposit Rs 30 lakh, you will get Rs 61,500 as interest every quarter during the entire duration of the scheme.
This amount comes to Rs 20,500 per month. You can also choose to transfer this interest directly to your savings account through ECS. In this way, you can earn Rs 12,30,000 in five years. You will get back the original amount invested after five years.
The amount invested in Senior Citizen Savings Scheme is eligible for tax deduction under Section 80C of Income Tax. The interest earned on this investment is added to the annual income of the investor on which tax has to be paid as per the slab. If the interest income is above Rs 50,000 then TDS will be deducted on it. If an investor does not fall under the purview of income tax, then he can avoid TDS deduction by filling Form 15G or 15H.
How to open an account?
Senior Citizen Savings Scheme account can be opened in all the post offices of the country where savings account opening facility is available. Apart from this, public sector banks like SBI, Bank of Baroda and PNB are also providing investment facility in this scheme.