Senior Citizens Savings Scheme

Senior Citizens Savings Scheme 2004

   Salient Features of the Scheme 

Tenure of the Scheme	5 years, which can be extended by 3 more years
Rate of interest	9% (simple interest)
Frequency of Computing interest	Quarterly
Tax aspects	Interest is fully taxable
Investment to be in multiples of	Rs.1000/-
Maximum investment limit	Rs.15 lakhs
Minimum eligible age	60 years (55 years for those who have retired under a voluntary or a special voluntary scheme provided investment is made within 1 month of date of receipt of retirement benefits for retired personnel of Defense Services (excluding Civilian Defense Employees) - no age limit.
Facility of premature withdrawals	Available after 1 year of holding but with penalty
Transferability feature	Not available
Tradability	Not available
Nomination Facility	Available
Mode of Holding	Generally single, Joint mode is permitted but only spouses will be allowed to open accounts jointly with beneficiaries.

Who can apply
The scheme is available for citizens above 60 years of age; however a provision has been put in place for individuals who have crossed 55 years of age. Such individuals may invest subject to the conditions that,

·           The person has retired under a voluntary retirement scheme or a special voluntary retirement scheme on the date of making the investment,

·           The investment is made within three months of the date of retirement,

·           And a certificate from the employer, indicating the fact of retirement, retirement benefits, along with period of such employment with the employer, is attached with the application form.

Non-Resident Indians and Hindu Undivided Families are not permitted to invest in the scheme.

Investment Limits
Investments can be made in any post-office by opening an account. Only one deposit can be made in each account; the deposit amount shall be a multiple of Rs.1,000 and should not exceed Rs.1,500,000.
A depositor can operate more than one account subject to the condition that all the deposits taken together don't exceed the specified amount i.e. Rs.1, 500,000. Also more than one account shall not be opened in the same post-office during a calendar month.

·           Interest rate - The scheme will offer an interest of 9 per cent per annum. The same will be payable on 31st March, 30th June, 30th September and 31st December each year.

·           Mode of holding - The depositor can hold an account either individually or jointly with his/ her spouse.

·           Nomination - Nomination facility has been provided under the scheme. In the event of death of the depositor, the amount due shall be paid to the nominee. Nomination facility is also available incase of joint accounts.

·           Maturity - The scheme has a tenure of 5 years. The account can be extended for a 3 year period by making an application.

·           Withdrawals - Investors will be permitted to prematurely liquidate their investments at any time after the expiry of 1 year from the date of opening of the account subject to the following conditions,

·           In case the account is closed after the expiry of 1 year but before the expiry of 2 years from the date of opening of the account, an amount equal to 1.5% of the deposit shall be deducted.

·           In case the account is closed on or after the expiry of 2 years from the date of opening of the account, an amount equal to 1% of the deposit shall be deducted.

·           Tax benefits - The interest income from the scheme is fully taxable.

Transfer of Account
The account can be transferred from one post-office to another.