Post Office Senior Citizen Savings Scheme: Interest Rates, Tax Benefits Explained Here

India Post, which has a network of over 1.5 lakh post offices across the country, provides a range of financial services. For the quarter ending September 30, India Post - under the Department of Posts - offers savings schemes with interest rates ranging from 4 per cent to 8.6 per cent. One such savings scheme offered by India Post is the Senior Citizen Savings Scheme (SCSS). The scheme offers an interest rate of 8.6  per cent per annum, said India Post on its website, indiapost.gov.in.

Here are 10 things to know about post office senior citizen savings scheme (SCSS):

1. Eligibility: The savings scheme can be opened by an individual of 60 years or above. An individual of the age of 55 years or more but less than 60 years, who has retired on superannuation, or under voluntary retirement scheme can also open account subject to the certain conditions, said India Post.

2. Amount: The minimum amount required to open the SCSS account is Rs. 1,000 and the maximum amount should not exceed Rs. 15 lakh, according to India Post's portal.

3. Maturity: The maturity period of senior citizen savings scheme is five years.

4. Income tax benefit: Investments under the scheme also qualify for the benefit of Section 80C of the Income Tax Act. TDS is deducted at source on interest if the interest amount is more than Rs. 10,000 per annum.

5. Premature closure: Under the post office's scheme, premature closure is allowed after one year on deduction of an amount equal to 1.5 per cent of the deposit. After 2 years, 1 per cent of the deposit is deducted.

6. Account extension: After maturity, the account can be extended for further three years within one year of the maturity by giving application in prescribed format. In such cases, account can be closed at any time after expiry of one year of extension without any deduction, noted India Post.

7. Nomination facility: Under the scheme, nomination facility is available at the time of opening and also after opening of account.

8. Account opening: The account can be opened by cash if the amount is below Rs. 1 lakh. However, if the amount is Rs. 1 lakh or more, investors need to deposit a cheque.

9. Number of accounts: Any number of accounts can be opened in any post office subject to maximum investment limit by adding balance in all accounts.

10. Joint account: A depositor may operate more than one account in individual capacity or jointly with spouse. However, joint account can be opened only with spouse and first depositor in joint account should be the investor.