Know this Post Office profitable scheme - Rs 14 lakhs in 5 years | Here is how; check income tax benefits

Post Office Senior Citizen Savings Scheme (SCSS): Post offices run a variety of special schemes and has schemes for people of all age groups. If you are planning to invest amid this corona crisis, then the chances of you gaining good returns within a few years are high. 

In this regard, by investing in a Post Office Senior Citizens Savings Scheme, investors can avail themselves of interest at the rate of 7.4 per cent. Let us tell you how you can make 14 lakh rupees in just 5 years. 

Who can open an account? 

The age for opening an account under the Senior Citizens Savings Scheme-SCSS should be 60 years. This scheme is for people aged 60 years or above, as well as, people who have taken VRS (Voluntary Retirement Scheme), can also open an account under this scheme. 

What happens you invest Rs 10 lakhs, an investor is likely to get over Rs 14 lakhs: How? Let’s find out. 

If the senior citizens invest a lump sum of Rs 10 lakhs in the scheme for five years, the total amount of investors will be Rs 14,28,964 on maturity, according to the interest rate of 7.4 per cent, which is compounding annually. As an investor, you get a benefit of Rs 4,28,964 as an interest. 

How much money is generally required to open an account? 

As per the scheme, the minimum amount to open an account in this scheme is Rs 1000, which can go up to over Rs 15 lakh that can be deposited in the SCSS account. If the amount to open the account is less than Rs 1 lakh, it can be opened by paying cash, and over Rs 1 lakh can be done by cheque. 

How much is the maturity period? 

The maturity period of SCSS is 5 years and can be extended if an investor wishes to. According to the India Post website, you can extend this scheme for 3 years after maturity, however, to increase this, the account holder will have to go to the post office and apply for the same. 

Tax Exemption  

If your interest amount exceeds Rs 10,000 annually under this scheme, then TDS is supposed to be deducted. However, investment in SCSS is exempt under Section 80C of the Income Tax Act. 

Can open a joint account 

Under SCSS, the depositor can also keep more than one account in a joint venture with his or her spouse. The maximum investment limit cannot be more than 1.5 million. A nomination facility is available at the time of opening and closing the account. 

Premature closing 

In this scheme, premature closure is also allowed. But the post office will deduct 1.5 per cent of the deposit only after closing the account after 1 year of account opening, while after closing after 2 years, one per cent of the deposit will be deducted.