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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. 

Post Office Investment Scheme 

Interest Rate for Senior Citizens 

Post Office Senior Citizens Savings Scheme (SCSS)

7.6% per annum; interest is paid on a quarterly basis

Post Office Savings Account

4.0% per annum; interest is compounded on an annual basis

Post Office Recurring Deposit Account (RD)

5.8% per annum; interest is compounded on a quarterly basis

Post Office Time Deposit Account (TD)

1-year TD - 5.5% per annum

2-year TD - 5.7% per annum

3-year TD - 5.8% per annum

5-year TD - 6.7% per annum


Interest is compounded on a quarterly basis

Post Office Monthly Income Scheme (MIS)

6.7% per annum; interest is paid on a monthly basis

Public Provident Fund Account (PPF)

7.1% per annum; interest is compounded on an annual basis

National Savings Certificate (NSC)

6.8% per annum; interest is compounded on an annual basis

Sukanya Samriddhi Account (SSA)

7.6% per annum; interest is compounded on an annual basis

Kisan Vikas Patra (KVP)

7.0% per annum; interest is compounded on an annual basis

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. 

FAQs

  • ✔️What is the age criteria for the Post Office Senior Citizen Scheme?

    Individuals above 60 years of age can open an SCSS account in a Post Office. Retired civilian employees aged between 55 years and 60 years and retired defence employees aged between 50 years and 60 years may also open an account provided they satisfy the eligibility criteria.

  • ✔️How to make an investment in the Post Office Senior Citizens Savings Scheme?

    The investment in the SCSS account needs to be made at the time of opening the account via a cheque or a demand draft.

  • ✔️What is the facility for the nomination of the Post Office Senior Citizens Savings Scheme Account?

    You can nominate an individual at the time of opening the SCSS account or at any point after the account opening by submitting Form C.

  • ✔️What is the Post Office SCSS Premature Closure?

    You can close your Post Office SCSS account at any time after the date of opening. However, a penalty will be levied for premature closure. The amount of penalty that’s levied may vary depending on when you close the account.

  • ✔️What is the interest rate on the Post Office Senior Citizen Scheme?

    The rate of interest applicable on the Post Office Senior Citizens Savings Scheme is reviewed every quarter and may be subject to change. Currently, the interest rate for the scheme is 7.6% per annum for the October to December quarter for the financial year 2022-2023.

  • ✔️Is Section 80C of the IT Act, applicable to the SCSS?

    Yes. You can claim the investment that you make towards the SCSS account under section 80C of the Income Tax Act, 1961. The maximum amount that you can claim is limited to ₹1.5 Lakhs per financial year.

  • ✔️Is it possible to extend the SCSS account?

    Yes. You can extend the tenor of your Post Office Senior Citizens Savings Scheme account by a period of 3 years by making an application. You can make an application for extension within a year from the date of maturity.