The government announced the small savings scheme interest rates for the October-December 2023 quarter, last week. The government has raised the interest rates on certain small savings schemes and post office schemes for the fiscal quarter ending December 31, 2023.
Also read: PPF, Sukanya Samriddhi, SCSS, NSC interest rates for December 2023 quarter announced; check here
Was Senior Citizens Savings Scheme interest rate hiked December 2023 quarter?
Anyone over the age of 60 can participate in this plan. Seniors can open an SCSS account at any authorised bank or post office.For the December 2023 quarter, the interest rate on Senior Citizens Savings Scheme was kept unchanged at 8.2%. Which is still higher than many big bank fixed deposits. Once the investment is done the interest rate remains the same throughout the tenure.
Senior Citizens’ Savings Scheme investment limit
Senior citizens can start an SCSS account with a minimum of Rs 1,000 and maximum of Rs 30 lakh. If an excess deposit is made in a SCSS account, the excess amount will be repaid to the depositor immediately, and only the PO Savings Account Interest rate will be applicable from the date of the excess deposit until the date of the refund.
Interest details
Interest will be paid quarterly from the date of deposit to the 31st March/30th June/30th September/31st December. If an account holder does not claim the quarterly interest, such interest will not generate additional interest.
Interest can be withdrawn via auto credit into a savings account at the same post office or ECS. Monthly interest on SCSS accounts at CBS Post Offices can be credited to savings accounts at any CBS Post Office.
Also read: Can Senior Citizen Savings Scheme account be closed anytime? What are the penalties for premature withdrawal
TDS on SCSS
If the total interest paid in all SCSS accounts exceeds Rs.50,000/- in a fiscal year, TDS at the required rate is deducted from the total interest paid. If form 15 G/15H is presented and accumulated interest is paid, no TDS will be deducted.
Premature Closure
(i) Accounts can be closed prematurely at any moment after they are opened.
(ii) If the account is closed before one year, no interest is payable, and any interest paid in the account is deducted from the principal.
(iii) If the account is closed after one year but before two years from the date of opening, 1.5% of the principal amount will be removed.
(iv) If the account is closed after 2 years but before 5 years from the date of opening, 1% of the principal amount will be removed.
(v) An extended account can be cancelled after one year from the date of extension without incurring any fees.
SCSS account maturity
After 5 years from the date of opening, the account can be discontinued by submitting the appropriate application form along with the passbook to the concerned Post Office. In the event of the account holder’s death, the account will earn interest at the rate of the PO Savings Account from the date of death. If a spouse is a joint holder or a sole nominee, the account can be continued until maturity if the spouse is entitled to open a SCSS account and does not already have one.
Can SCSS account be extended
The account holder can extend the account for another three years from the date of maturity by submitting the appropriate paperwork along with the passbook to the relevant post office. Within one year of maturity, the account can be extended. The extended account will earn interest at the rate in effect on the maturity date.
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