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Will Investing In Post Office Save Income Tax?

Adhil Shetty

Q.  Does investing in a post office save my income tax? Nishant Singh

A.  Apart from investing in mutual funds, tax saving FDs offered by banks, life insurance, etc., post office schemes offer attractive options to save on taxes. The tax saving schemes offered by post offices qualify for deductions under Section 80C of the Income Tax Act, with a maximum cap of Rs.1.5 lakh. Some of the popular tax saving investment instruments available through post offices are mentioned below:

  • SCSS – Senior Citizen Savings Scheme: Offers interest at 8.6% p.a.
  • SSY – Sukanya Sammriddhi Yojna: Offers interest at 8.4% p.a.
  • PPF – Public Provident Fund: Offers interest at 7.9% p.a.
  • NSC – National Savings Certificate: Offers interest at 7.9% p.a.

If you are looking for a tax-saving fixed-return instrument, then post office schemes can be very attractive in the current market in terms of returns and safety.

Have a question on personal finance? Ping me on Twitter at @adhilshetty with the hashtag #AskAdhil. The writer is CEO,, an online marketplace for loans and credit cards.