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Top 5 Post Office Tax Saving Schemes- Offering Income Tax Deduction Under 80C

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India Post offers dependable investments and rewards through a number of post office programmes or schemes. The plan that best suits a person's investment goals can be chosen. Here are five post office programmes that provide tax advantages under Section 80C of the Income Tax Act.

 

Sukanya Samriddhi Yojana

Sukanya Samriddhi Yojana

A small savings programme called Sukanya Samriddhi Yojana, or SSY, was created with the goal of promoting the welfare of young girls. Before the girl turns 10 years old, her parent or legal guardian can open an SSY Account at a post office or bank. The current interest rate for the Sukanya Samriddhi Yojana is 7.6% from January through March 2023. The Post Office Sukanya Samriddhi Scheme is classified as having an EEE (Exempt-Exempt-Exempt) tax status under Section 80C of the Income Tax Act.

Public Provident Fund (PPF)
 

Public Provident Fund (PPF)

One of the most well-liked savings plans governed by the Central Government of India is the PPF, or Public Provident Fund. For the fourth quarter of the 2022-2023 fiscal year, the Public Provident Fund's current interest rate is 7.1%. PPF is categorised under the Exempt-Exempt-Exempt (EEE) tax status, just like Sukanya Samriddhi Yojana. Under Section 80C of the Income Tax Act of 1961, contributions made to PPF accounts are eligible for tax deductions of up to Rs. 1.5 lakh.

Post Office Recurring Deposits

Post Office Recurring Deposits

An investment option called a Post Office Recurring Deposit allows investors to make regular monthly deposits over the course of five years. Interest on Post Office Recurring Deposits is 5.8% yearly (compounded annually). Additionally, Section 80C allows subscribers to deduct up to Rs. 1,50,000 in taxes. Although there is no TDS applied to the interest earned from this account, the investors must still pay taxes on the income according to their tax bracket.

Post Office Savings Account

Post Office Savings Account

You can open a savings account at a post office in the same way that you can with a bank. A minimum deposit of Rs. 500 is required to start a Post Office savings account, and there is no maximum deposit amount. The current interest rate for Post Office savings accounts is 4%, and the post office pays interest on the amount of the account. Savings account income, including that from Post Office According to Section 80TTA of the Income Tax Act, savings account income, including that from Post Office Savings Accounts, is deductible from gross income up to Rs. 10,000. Seniors who have Post Office savings accounts will receive a larger rate of interest income exemption than other individuals, it must be noted. Senior citizens are not eligible for deductions under Section 80TTA.

Senior Citizen Savings Scheme

Senior Citizen Savings Scheme

Those who have chosen voluntary retirement between the ages of 55 and 60 and over may invest in the Senior Citizen Savings Scheme (SCSS). This Post Office programme has a five-year term and a 15 lakh rupee investment cap. The Senior Citizen Savings Scheme now has an interest rate of 8%.
Under Section 80C of the Income Tax Act, investments made in this plan are tax deductible. However, tax would be withheld at source if the amount of interest earned in a year exceeds Rs. 10,000.

Read more about: post office tax saving scheme
Story first published: Tuesday, January 31, 2023, 23:27 [IST]
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