Post Office NSC: If you are thinking of investing in the coming days, then the small savings scheme of the post office can be a good option. Interest on FDs or RDs in banks is also declining continuously. If you are a taxpayer, here you get better returns along with saving tax and with that your investment is also safe. You can invest in the National Savings Certificate (NSC) of the post office.
This scheme of post office not only provides good returns but also saves tax under section 80C of the Income Tax Act. The tax deduction can be availed on NSC up to a maximum amount of Rs 1.5 lakh under this section. While calculating income tax, a taxpayer under section 80C gets the benefit of the deduction, which he can deduct from his income as expenses, so that he has to pay tax on the lesser amount.
Interest rate and tenure
The National Savings Certificate (NSC) scheme of the post office is currently getting 6.8 percent interest annually. It is compounded on an annual basis but the payment is on maturity only. The tenure of this scheme is 5 years old. According to the information given on the post office website, if you invest in NSC from Rs 1000, then after 5 years you will get Rs 1389.49.
- Investments can be started from the National Savings Certificate. There is no maximum investment limit.
- Certificate in the scheme Anyone adult, with a maximum of three adults, can take a joint account, a minor of more than 10 years of age.
- NSC can be purchased from any Indian Post Office.
- Interest is deposited annually but payment is made only at maturity, in which TDS is not deducted.
- NSC is accepted as collateral or security for loans by all banks and NBFC.
- An investor can nominate any member of his family.
- NSC can be transferred from one person to another in the name of a person between the time of issue and maturity date.
Who can invest?
All Indian residents can invest in NSC. Non-Indian citizens (NRIs) cannot purchase NSCs. However, if a resident Indian has purchased an NSC and becomes an NRI before maturity, then he gets the benefit. Trusts and Hindu Undivided Family (HUF) cannot invest in NSC. HUF Karta can invest in NSC only in their name.