How Does SCSS Work?

Deposit a lump sum amount

At the end of the tenure, you will get your deposit amount back

Every quarter you will receive interest till the end of the tenure

Features

Scheme exclusively for Senior Citizens

Backed by the Government of India

Safe investment option

Guaranteed returns

Regular quarterly income

Peace of mind during retirement life

Income tax benefits

Income Tax Benefits

Effective 01-Apr-2020, the income tax benefits will depend upon whether you choose old tax system or new tax system. Old Tax System: Deposit amount (up to Rs. 1.5 Lakhs) qualifies for tax deduction under Section 80C of the Income Tax Act. TDS (Tax Deducted at Source) is deducted on interest amount if the interest received is more than Rs. 50,000 in a financial year. This new limit of Rs. 50,000 is from the financial year 2018-19. That is, from 01-Apr-2018 onwards. Note that the limit was Rs. 10,000 earlier. Interest received under this scheme is taxable. You need to declare the interest income under "Income from Other Sources" during tax returns and pay the income tax as per your income tax slab.

New Tax System: No income tax benefits. The deposit amount won't get any deduction benefit under Section 80C of the Income Tax Act. TDS (Tax Deducted at Source) is deducted on interest amount if the interest received is more than Rs. 50,000 in a financial year. This new limit of Rs. 50,000 is from the financial year 2018-19. That is, from 01-Apr-2018 onwards. Note that the limit was Rs. 10,000 earlier.

nterest received under this scheme is taxable. You need to declare the interest income under "Income from Other Sources" during tax returns and pay the income tax as pe Who Can Open The Account? Only Indian residents can open the account. An individual of the age of 60 years or more can open the account. An individual of the age of 55 years or more but less than 60 years and who has retired on superannuation or under VRS can also open account. The retired personnel of Defence Services (excluding civilian Defence employees) of the age of 50 years or more can open the account. Joint account can be opened with spouse only. First depositor in joint account is the investor. A depositor can open more than one account either individually or jointly with spouse. Any number of accounts can be opened. But, total investment in all the accounts should not exceed the maximum investment limit of Rs. 15 Lakhs.

Term

Maturity Period for this scheme is 5 Years.

Interest Rate (%)

Current annual interest rate is 7.40%. Interest amount is paid on a quarterly basis. That means interest is paid at the end of Calendar quarter (31st March, 30th June, 30th Sept and 31st December). Interest rate (on the day of account opening) will remain the same throughout the tenure of SCSS. It will not change even if there are changes to the interest rate thereafter. From 01-Apr-2016 onwards, the interest rate for this scheme has been announced on a quarterly basis. Note that this used to be on a yearly basis earlier.