Post Office Savings Scheme

The Post Office Time Deposit Scheme can be opened by an individual. One can easily open the account either by cash payment mode or by means of a cheque. If one is opting for cheque the date of realization of cheque in Govt. account shall be date of opening of account. One can opt for a nominee both at the time of opening the account or even after the account has been opened. The best features of this scheme are that one can easily transfer the account from one post office to another in addition to opening up of several accounts.

Salient Features:

• Interest payable annually but compounded quarterly:
  

  PERIOD	RATE OF INTEREST
  One Year	8.2%
  Two Years	8.3%
  Three Years	8.4%
  Five Years	8.5%

• Minimum amount of deposit is Rs 200/- and in multiples of Rs 200/- thereafter. No maximum limit.
• Investment up to Rs 1,00,000/- per annum qualifies for Income Tax Rebate under Section 80C of IT Act.
• Interest income is taxable.
• Facility of redeposit on maturity of an account.
• In case of premature closure of 1 year, 2 Year, 3 Year or 5 Year account on or after 01.12.2011 between 6 months to one year from the date of deposit, simple interest at the rate applicable to from time to time to post office savings account shall be payable.
• 2 year, 3 year or 5 year accounts on or after 01.12.2011 if closed after one year, interest on such deposits shall be calculated at a discount of 1% on the rate specified for respective period as mentioned in the concerned table given under Rule 7 of Post office Time Deposit Rules.
• Account can be pledged as security against a loan to banks/ Government institutions.
• Any individual (a single adult or two adults jointly) can open an account.
• Group Accounts, Institutional Accounts and Misc. account not permissible.
• Trust, Regimental Fund or Welfare Fund not permissible to invest.