Post Office Senior Citizen Saving Scheme

The Senior Citizens Savings Scheme (SCSS) is an investment option offered by India Post. The scheme has been designed with the aim of offering individuals aged between 55 and 60 years of age a safe investment option with high returns. 

Since the Post Office Senior Citizens Savings Scheme is a government-backed investment, there’s zero investment risk involved. You can invest in the plan individually or jointly with another eligible individual. One of the many benefits that you get to enjoy by investing in SCSS is the ability to claim tax benefits to the tune of ₹1.5 Lakhs under section 80C. 

Post Office Interest Rates for Senior Citizens 

The interest rates for the SCSS scheme in Post Offices are set by the government of India and reviewed on a quarterly basis. As a result, the rate of interest is subject to change from time to time. Currently, the rate of interest for the plan for the October to December quarter of the financial year 2022-2023 is 7.6% per annum. 

For the sake of comparison, here’s a table outlining the different Post Office interest rates for Senior Citizens. 

Note: The interest rates mentioned above are with effect from October 01, 2022 to December 31, 2022 and are subject to change periodically. 

Features of Post Office Senior Citizens Savings Scheme (SCSS)

The Post Office Senior Citizens Savings Scheme is one of the safest investment options available in India that offer high and stable returns. Here’s a quick look at some of the key features of this scheme.

1. SCSS in Post Office Maturity Period

The Senior Citizens Savings Scheme has a fixed tenor of 5 years from the date of opening of the account. If the account holder dies at any point during the tenor, the account will earn interest only at the rate applicable for a Post Office savings account. However, if the account is held jointly, the surviving individual can choose to continue with the account if they’re eligible and don’t already have an SCSS account. 

2. Deposit Limit

You can invest in SCSS in a Post Office with a minimum deposit amount of just ₹1,000. You can invest more than the minimum amount as long as the amount of deposit is in multiples of ₹1,000. The maximum amount that you can deposit in the scheme is ₹15 Lakhs. If you happen to possess multiple SCSS accounts, the collective investment amount shouldn’t exceed the maximum amount permissible under the scheme. 

3. Premature Closure

The SCSS account can be prematurely closed at any point in time after opening. However, you will be levied a penalty for opting for this feature. The amount of penalty varies depending on when you close the account. Here’s a quick look. 

• If the account is closed before the completion of 1 year, no interest will be paid. If the account holder has already received any interest, it will be recovered from the investment amount. 

• If the account is closed between the 1st and 2nd year, a penalty of 1.5% of the investment amount will be deducted. 

• If the account is closed between the 2nd and 5th year, a penalty of 1% of the investment amount will be deducted. 

4. Tax Benefit

The investment that you make in a Post Office SCSS account can be claimed as a deduction from your total taxable income under section 80C of the Income Tax Act, 1961. The maximum amount of deduction, however, is limited to ₹1.5 Lakhs per financial year. 

5. Multiple Accounts

An individual can have multiple SCSS accounts, both individually and jointly with another individual. The joint holder need not be a senior citizen. However, despite possessing multiple SCSS accounts, the collective amount of investment in all the accounts shouldn’t exceed ₹15 Lakhs. 

6. Nomination Facility

At any time during the tenor of the Post Office Senior Citizens Savings Scheme, you can appoint a nominee by filing Form C. 

Post Office SCSS: Eligibility Criteria & Documents Needed

Only individuals who satisfy the eligibility criteria are allowed to invest in the Post Office Senior Citizen scheme. Here’s a quick glimpse of the criteria set by India Post. 

• Applicants must be above 60 years of age. 

• Retired civilian employees aged between 55 years and 60 years may also open an SCSS account. However, the investment must be made within 1 month from the date of receipt of retirement benefits. 

• Retired defence employees aged between 50 years and 60 years may also open an SCSS account. However, the investment must be made within 1 month from the date of receipt of retirement benefits. 

If you’re found to be eligible for the SCSS scheme, you can open an account by submitting the following list of documents at a Post Office branch. 

• A duly filled and signed SCSS account opening form. 

• A duly filled and signed Know Your Customer (KYC) form. 

• A copy of your PAN 

• A copy of your Aadhaar card

• A copy of your address proof

• A passport size photograph

• A copy of the document evidencing the disbursal date of your retirement benefits

• A copy of your employer’s certificate mentioning your retirement, VRS or superannuation

How to Open a Senior Citizen Saving Scheme in the Post Office?

Opening a Post Office SCSS account is very easy. All that you would need to do is follow the steps mentioned below. 

• Step 1: Visit a Post Office near you and request for the Post Office Senior Citizens Savings Scheme application form. Alternatively, you can also download the form from the official website of India Post.

• Step 2: Fill the account opening form carefully. Make sure to enter all the required details including the details of the nominee.

• Step 3: Submit the above-mentioned list of documents along with the application form. You may be asked to provide your original identity proof document for verification. 

• Step 4: Complete the procedure by getting the signature of a witness. 

That’s it. Your Post Office Senior Citizens Savings Scheme account will be opened within a few days from the date of submission of the application form.