Arun Jaitley has done his very best to promote savings in the country by offering various sops from enhancing limits under 80C to boosting benefits to several Small Savings Schemes offered by the Post Office. Here's how a few post office schemes remain attractive after the Union Budget 2014.
Now with insurance
The Budget has announced a National Savings Certificate with insurance cover to provide additional benefit to small investors. The finer details are not yet known. It's also important to remember that NSC provides tax benefit under Sec 80C and now with insurance, it remains a good scheme.
Patient long term investors can double their money
The popular Kissan Vikas Patra (KVP) which had been withdrawn earlier has now been re-introduced. The KVP was doubling money in 8 years and seven months, before it was withdrawn. One will have to wait and see what interest rate the government offers on KVP. Again, an excellent tax saving tool. Government backed, so do not bother about safety.
The finest of the lot
The maximum amount that can now be invested under the public provident fund (PPF) has also been increased to Rs 1.5 lakh per annum from the earlier limit of Rs 1 lakh currently in the Union Budget. This is the pick of the lot because it comes with SEC 80C benefit and also the interest earned is tax free.
Most Post Office Tax Saving Schemes offer tax break
The Union Budget has increased the tax exemption limit on Sec 80C from Rs 1 lakh to Rs 1.5 lakh. Most of the Small Savings Scheme offered by the Post Office like NSC, PPF and KVP qualify for Sec 80C tax breaks. This makes Small Saving Schemes from Post Office very attractive.