SO FAR VISITED

SO FAR VISITIED
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Saturday, January 15, 2011

Why should you invest in Post Office Schemes - Check the variety

scheme

Interest Rates

Tenure

Investment Denominations and limits

Salient Features

Tax rebate

Post Office Savings Account

3.5% p.a. On individual and joint account

No specific or fix tenure

Min: Rs. 50 Max: Rs. 1 lakh for individual and 2 lakhs for joint account

Cheque facility available

Interest is tax-free u/s 80L

5-Year Post Office Recurring Deposit Account

7.5% compounded quarterly

5 years. Can be renewed for another 5 years

Min: Rs. 10 per month or multiples of Rs. 5 Max: No limit

One withdrawal up to 50% of the balance is allowed after one year. Full maturity value allowed on R.D. 6 & 12 months advance deposits earn rebate.

No tax rebate

Post Office Time Deposit Account

6.25%- 1 year

6.50 - 2 years

Min: Rs. 200 and its multiple thereof Max: No limit

Long-term accounts could be closed after 1 year for discounted interest. Accounts could be closed after 6 months but before a year for no interest. Interest is calculated quarterly but payable yearly.

Investment qualifies fordeduction u/s 80C. Interest is tax-free u/s 80L

7.25%

3 years

7.50%

5 years

Post OfficeMonthly IncomeAccount

8% p.a.

6 years

Min: Rs. 1500 per month or multiples of it.Max: Rs. 4.5 lakhs for individual account and Rs. 9 lakhs for joint account

Account if closed after 1 year but before 3 years will suffer a deduction of 2% of the deposit. Account if closed after 3 years will suffer a deduction of 1% of the deposit. On maturity, bonus of 5% on principal amount is admissible

Interest is tax-free u/s 80L

15-year Public Provident Fund Account

8% p.a. compounded yearly

15 years tenure

Min: Rs. 500 in 1 year Max: Rs. 70000 in 1 year Deposits can be made in lump-sum or 12 installments

Withdrawal can be made every year after the 7th financial year. From the 3rd financial year, loan can be availed against PPF. No attachment under court decree order.

Investment qualifies fordeduction u/s 80C. Interest is tax-free u/s 80L

Kisan Vikas Patra

8.4% compounded yearly. Money doubles in 8 years and 7 months

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No limits. Investment denominations available are of Rs. 100, Rs. 500, Rs. 1000, Rs. 5000, Rs. 10,000, in all Post Offices and Rs. 50,000 in all Head Post Offices.

A single holder certificate can be purchased by an adult. A certificate can also be purchased jointly by two adults.

No tax benefits

National SavingsCertificate (VIII issue)

8% p.a. compounded half-yearly but payable after maturity

6 years

Min: Rs. 100. Also available in denominations of Rs. 100/-, 500/-, 1000/-, 5000 & Rs. 10,000/-. Max: no limit

A single holder certificate can be purchased by an adult.

Investment as well as the interest deemed to be re-invested qualifies for deduction u/s 80C.

Senior Citizens Savings Scheme

9% p.a.

5 years

Only 1 deposit allowed in multiple of Rs. 1000. Max is Rs. 15 lakhs

Age should be above 60 years or 55 years above if retired under superannuation. Account if closed after 1 year will suffer a deduction of 1.5% interest and after 2 years will suffer a deduction of 1% interest. TDS is made on interest if it exceeds Rs. 10000 p.a.

Investment qualifies fordeduction u/s 80C.

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