How to open SCSS Account?
SCSS account can be opened up in post office and banks. You need to fill and submit Form A and deposit amount with Form D. Check the complete process here.
What is the current interest rate of SCSS Account?
From 1 April’ 2012 – the interest rate for senior citizens savings scheme (SCSS) has been hiked to 9.3 per cent from 9 per cent. Interest is provided from the date of deposit on quarterly basis. Interest can be automatically credited to savings account provided both the accounts stand in the same post office/bank. Interest rounded off to the nearest multiple of rupee one.
Please keep in mind that the interest is payable quarterly instead of compounded quarterly. Thus, unclaimed interest on these deposits won’t earn any further interest. Interest income is chargeable to tax.
Can I take loan against SCSS Account?
The facility of pledging the deposit in the SCSS account to obtain loans is not permitted.
What are the Tax Implications on SCSS Account?
The sum invested in the SCSS is eligible for tax deduction under section 80C of the Income Tax Act. However, the interest earned on the deposit is fully taxable and tax is deducted at source (TDS) only if the total interest in a year is above Rs 5,000. However, if the income is not taxable, one has to provide form 15H or 15G so that no tax is deducted at source.
How to do premature withdrawal or closure of SCSS Account?
Premature withdrawal or closure of the SCSS account is permitted only after completion of one year from the date of opening the account after deducting a penalty for early withdrawal or closure (Form E) –
1- If the account is closed after the first year and before the end of the second year, an amount equal to 1.5 per cent of the deposit shall be deducted as penalty.
2- If the account is closed on or after the second year but before date of maturity, an amount equal to 1 per cent of the deposit shall be deducted.
What happens to the SCSS Account in case of death of the depositor?
In case of death of the depositor before maturity, the account shall be closed and deposit refunded without any deduction along with interest.