Senior Citizen Savings Scheme (SCSS) {वरिष्ठ नागरिक बचत योजना}

As the name already tells about the scheme that the Senior Citizen Savings Scheme (SCSS) is a scheme for senior citizens and launched by the Government of India in the year 2004. The main motive of this scheme is to provide financial assistance to retirees in terms of ensuring a monthly flow of income. The interest payment is definite as well as will be received quarterly. The Senior Citizen Savings Scheme is the best scheme for senior citizens who want to do investment as well as save tax at the same time.

If your age is 60 or 60+ then you want basic things from your investment that are safety as well as regular income. And the Senior Citizen Savings Scheme is the best way to fulfill these requirements. This will help you to get an assumption from taxable income too. This scheme is processed by the Government of India and completely safe.

Who can Invest?

In this scheme any person who is an Indian citizen as well as over the age of 60 is able to invest in this scheme. The person who has taken early retirement because of any reason is also eligible to invest in this scheme. This scheme is not for those who are not living in India and for non-resident Indians (NRIs) and Hindu Undivided Families (HUFs).

Interest Rates

The most important aspect of the scheme is the rate of interest is very high. At the time of writing the scheme offers an 8.6% interest rate which is the best rate for a scheme as well as without any risk. There are other schemes like Public Provident Fund (PPF) and National Savings Certificates (NSC) which are also best but offer only a 7.9 percent interest rate. And these schemes are a bit risky also.

Tax Benefits

Like some other schemes, you can deduct investments in Senior Citizen Savings Scheme from your taxable income but the maximum limit is Rs. 1.5 lakh. And these all deductions are given under Section 80C of the Income Tax Act. And all the investment under this act is not more than this amount.

Tenure

The time period of SCSS is five years, as compared to NSC as well as five-year bank fixed deposits. The person is able to extend it by another three years.

Minimum and Maximum Investment

The person can invest a minimum of Rs. 1,000 as well as in multiples thereof. The maximum amount that the person can invest is Rs. 15 lakh. 

Interest Payout

Interest under this scheme is calculated on a quarterly basis as well as credit to your bank account by itself. The dates when the interest will be credited to the account are April, 1 July, 1 October, and 1 January.

Premature Withdrawal

If a person wants to withdraw his amount after one year then he can. For this, the person has to pay a charge of 1.5 percent of the deposit amount. And if you withdraw the amount after two years then you have to pay 1 percent of the deposit amount.

Tax on Interest Income

If the amount exceeds Rs. 10,000 a year then there will be TDS. You can assert a deduction from taxable income under Section 80TTB of the Income Tax Act for interest income of Rs. 50,000 in a year.

Where to Open SCSS Deposit?

At any post office or selected banks, you are able to open an SCSS deposit.

Benefits of Senior Citizens Savings Scheme

• As a scheme is processed by the government of India so it offers safety as well as a guarantee of your investment. The scheme also provides reasonable interest on your investment.
• The process of this scheme is very simple. You can easily open, operate, and transfer the SCSS account at an authorized post office in India or the bank.
• The time period for this scheme is five years and after its maturity then you can extend it up to three years. But you can extend this time [period only once.

SCSS Latest Rules 

All the latest rules of the Senior Citizens Savings Scheme are explained below:

• An account open under the Senior Citizens Savings Scheme can be closed before one year from the date when the account is opened. But the interest that is paid will be recovered from the amount and the remaining balance will be paid to the account holder.
• If the account in the Senior Citizens Savings Scheme is closed after one year then an amount equal to 1.5% of the deposit amount will be deducted and if the account is closed after two years then amount equal to 1% of the deposit amount will be deducted and the remaining balance will be returned to the account holder.
• If the maturity period of 65 years is completed and the account holder extends the period then the account can be closed after one year and then there will be no deduction from the amount.
• In the case of the death of the account holder before completing the maturity period, the full amount will be refunded with the interest at the rate of SCSS till the date of the demise.
• In case of joint account if any person from two meets with eligibility criteria can register under the scheme on the date of death of the account holder.
• If the spouse opens any separate account under this scheme and if the spouse dies throughout the currency of such account the name of the account holder will not be able to continue and the account will be closed.
• If the account holder wants to take benefit of the extra three years then he has to register again after the completion of the maturity period that is five years. If the account holder will not apply again the account will be not treated as an extended-time period account.

Eligibility Criteria

To apply under this scheme the person has to fulfill the eligibility criteria. All the details about eligibility criteria are mentioned below:

• This scheme is only for the residents of India. Only the person who is from India can apply under this scheme.
• The scheme’s benefits are for senior citizens or individuals aged 60 years and above.
• And the person who has taken retirement early or at the age of 55 years is also eligible to invest in this scheme.
• The scheme is also for retired defense personnel irrespective if they meet the age criteria as well as other conditions of the scheme.
• The person who is not Indian or Non-Resident Indians (NRIs) and Person of Indian Origin (PIOs) are not eligible to invest under this scheme.
• Hindu Undivided Family members are also not able to take the benefits of this scheme.

How to Open Account at Post Office for SCSS?

The person is able to open a Senior Citizens Savings Scheme account by visiting any Post Offices in India.  The amount of interest that will be earned under this scheme will directly be transferred to the post office account of the investor. The option of an SCSS account is also available to Indians who are located in the most remote parts as well as across the country.

How to Open Account at banks for SCSS?

Apart from the post offices, you are also able to open the SCSS account at selected Public or Private sector banks. Here is mentioned benefits to open Senior Citizen’s Savings Scheme account at authorized banks:

• The amount that is interest can be directly transferred to the depositor’s savings bank account held with the bank branch.
• Account statements will be transferred to depositors with post or email.
• You are able to take phone service full time through phone banking services.

SCSS registration at a bank

If any senior citizen plans to complete his SCSS registration at a bank, he has to follow the applicable account opening process.

SCSS Application Form Download Online

You are able to fill Senior Citizen’s Application Form via the offline route at India Post Offices as well as online. If you are going to fill the application form at an India Post Office then you can easily download the application form from the official website.

The private and public banks are also having the option of SCSS Application form download by visiting their official websites. You can also choose to take application form at designated branches of participating banks in India

How to Fill Application Form?

You are able to apply for the SCSS account currently by downloading the application form and then you have to print, fill all the details and submit the completed Application form at the post office or bank along with the required documents. There are some important points to fill the SCSS application form:

• Name of the applicant and PAN.
• Name of the applicant’s father, mother, husband, or wife.
• If the account is a joint account then you have to give details about the name, age, and address of your spouse.
• Name, age, and address of the nominee if you want to give.

List of Banks under SCSS

All the banks who are registered under the Senior Citizen Savings Scheme and offering the facility to open an account under the scheme are mentioned below:

• Allahabad Bank
• Andhra bank
• State Bank of India
• Bank of Maharashtra
• Bank of Baroda
• Bank of India
• Corporation Bank
• Canara Bank
• Central Bank of India
• Dena Bank
• Syndicate Bank
• UCO Bank
• Union Bank of India
• Vijaya Bank
• IDBI Bank
• Indian Bank
• Indian Overseas Bank
• Punjab National Bank
• United Bank of India

Frequently Asked Questions

Q. How to open a senior citizen savings scheme account online?

You can open the SCSS account online by visiting the post office or bank branch. After completing the application form the candidate has to attach it with KYC documents, age proof, and ID proof, Address proof as well as a cheque for deposit amount.

Q. Is the 80C act applicable to senior citizen savings schemes?

Yes, investments made in SCSS are able for an income tax deduction.

Q. Can someone open a senior citizen saving account with SBI Bank?

Yes, you can freely open a senior citizen saving account with SBI Bank.

Q. What is the age to open an account under a senior citizen saving scheme?

Any individual, who is from India and above the age of 60, can easily open a Senior citizen savings account to get the benefits.

Q. Can someone open a joint SCSS account?

Yes, a joint SCSS account can be opened only with the spouse and maximum investment in this is Rs.15 lakh in the multiples of Rs.1000.

Q. Where can I learn more about this scheme?

You can learn more about this scheme on the official page for Post Office Saving Schemes.