Tax Saving Schemes and risk-free investment tools?...

Post office Tax Saving Schemes are reliable and risk-free investment tools that assure investors of secure returns. Operated by post offices across the country, these schemes are open for investment to every indian citizen. These tax saving schemes give income tax benefits as per various sections of the Income Tax Act, 1961. Post office tax saving schemes include schemes like Public Provident Fund, sukanya Samriddhi Account, National Savings Certificate, Senior Citizen Saving Scheme (SCSS), Post Savings Account and 5-Year Fixed Deposit. 

Public Provident Fund

Investors can open only one PPF account in their own name, and there is no provision for a joint account. Nomination facilities are available and account holders can transfer their accounts from one post office to another. 500 per annum to the investors, failing which the account is closed. The maximum deposit that can be made in a financial year is Rs 1.5 lakh.

The maturity period of this scheme is 15 years and investors can extend it in blocks of 5 years.

Investors can do partial withdrawal after completing 7 years and can also take a loan after 4 years. Deposits made under this scheme are tax-free under section 80C of the Income Tax Act. The investor gets a return of 7.1 per cent per annum on his investment, with its interest rate changing every three months.

Sukanya Samriddhi Account

Operated under the sukanya Samriddhi Yojana, it is one of the Post office Tax Saving Schemes under 80C. A legal guardian can open this account for his/her girl child, and one account for one child and a maximum of two accounts are allowed in the family. Other features are:-

This account can be opened for girls below the age of 10 years.

The tenure of this scheme is 21 years, regardless of the age of the girl child at the time of opening the account. The investor has to invest in this scheme for 15 years, if any investor is not able to do so then the account is closed. You can invest a minimum of Rs 50 and a maximum of Rs 1.5 lakh in this scheme.

National Savings Certificates

To invest in this post office saving scheme for tax benefits, investors have to pay the entire investment amount in one go. They will receive the total amount, i.e. principal+interest, at the time of maturity. 

Senior Citizen Saving Scheme

Individuals above 60 years of age are eligible to invest in the Senior Citizen Savings Scheme. Also, individuals above 55 years and below 60 years of age and have retired, or have taken VRS, can invest in this scheme.