As the application deadline for returns draws nearer, there is a massive scramble by individuals to look for tax-saving investing opportunities. Other than banks and private/public financial firms, if you are aiming for the same thing, you should also recognise the investment plans provided by post offices.
Several savings plans are provided by the post office. In this, your money is secure, as well as you earn good interest. Most of them are the post office's National Savings Certificate (NSC) scheme and a wide variety of investment plans are provided as well and all of them will be eligible for tax benefit.
If you are new to post office tax saving programs, here are five things you should know about them:
It earns you an interest of 6.8 percent
The interest rate on investments is 6.8 percent yearly. Interest is measured yearly, but only after the end of the accounting period interest is calculated. This system has a term of 5 years. It will, however, be extended upon maturity for the next 5 years.
Investments will begin at Rs 1000
You would have to pay a minimum of Rs 1000 if you start an NSC account. In NSC, you can invest any number. The cumulative contribution cap does not exist. This account can be accessed collectively on behalf of a minor and behalf of 3 adults as well.
Benefits from Income Tax rebates are available
For deposits made in the National Certificate of Savings, under Section 80C of the Income Tax Act on transactions in NSC, tax is exempted. This rebate is, however, only valid on investments up to Rs 1.5 lakh.
Different transfer accounts can be converted
The VIII issue of NSC has a maturity period of five years. Interest accrues annually but is payable on maturity. The certificate can be transferred only once during its tenure. A certificate can be transferred only after a year from the date of issue.
How much will the return be?
If you invest Rs 2 lakh you will receive Rs 2 lakh 80 thousand after 5 years at an interest rate of 6.8 percent per year. That is, you can get an interest of 80 thousand rupees.
To read about these programs and start saving, check the official India Post website or check the nearest post office.