Who can spend money on the Senior Citizen Savings Scheme?

NEW DELHI: A Senior Citizen Savings Scheme (SCSS) is a retirement advantages scheme backed by the federal government. A senior citizen can spend money on the scheme in a lump sum, individually or collectively, and get entry to common earnings together with tax breaks.

Here are the next three standards which will help an Indian resident spend money on the scheme.

1. An Indian senior citizen, 60 years or above.

2. While attaining the age of 55-60 years, in case you have opted for the voluntary retirement scheme (VRS), you’ll be able to spend money on SCSS.

3. Any retired defence personnel who has attained the age of fifty years and is under 60 years of age also can make investments within the scheme.

HUFs and NRIs are usually not allowed to spend money on SCS Scheme.

You can open an SCSS account at any authorised financial institution or any publish workplace in India. While opening an account you can also make a minimal deposit of Rs1,000 as much as ₹15 lakh in a single instalment. The SCSS account is transferable throughout the nation. The account is initially opened for a interval of 5 years which may be prolonged by three years.

It is among the many most secure funding choices for senior residents.

While investing, a senior citizen can avail an earnings tax deduction of as much as ₹1.5 lakh below Section 80C of the Income Tax Act. Currently, the rate of interest relevant on SCSS is 7.4% each year.

Under the scheme, curiosity payouts are quarterly and get credited on the primary day of April, July, October, and January each monetary yr.

A untimely withdrawal from the account attracts a penalty. Withdrawals are permissible after the completion of 1 yr, with the penalty various between 1% and 1.5% of the deposited quantity.

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