Senior Citizen Savings Scheme: Eligibility Criteria, Interest Rates, And Tax Benefits Explained

Senior Citizen Savings Scheme: Available through Post Offices and authorised banks, the SCSS offers regular income, tax benefits, and guaranteed returns, making it a popular option among retirees

Senior Citizen Savings Scheme: The SCSS has a maturity period of five years, which can be extended for an additional three years.

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Senior Citizen Savings Scheme: The Senior Citizen Savings Scheme (SCSS) is a government-backed savings initiative designed to provide financial security to senior citizens in India. Available through Post Offices and authorised banks, the SCSS offers regular income, tax benefits, and guaranteed returns, making it a popular option among retirees. SCSS offers a reliable savings option for senior citizens, providing a secure and steady income stream post-retirement, along with tax benefits and attractive interest rates. 

In the following are the key features of SCSS.

Eligibility

Individuals aged 60 years and above are eligible to open an SCSS account.

Retired civilian employees aged 55 to 60 years, and retired defence personnel aged 50 to 60 years, can also invest in SCSS within one month of receiving their retirement benefits.

Deposit Options

The scheme allows a minimum deposit of Rs 1,000 and a maximum deposit of Rs 30 lakh, in multiples of Rs 1,000.

For deposits below Rs 1 lakh, cash payment is allowed. For amounts above Rs 1 lakh, payment must be made by cheque.

Interest Rate

The current interest rate for SCSS stands at 8.2 per cent per annum, effective from April 1, 2024, to March 31, 2025.

Interest is paid quarterly, with disbursements scheduled for April 1, July 1, October 1, and January 1.

Maturity and Extension

The SCSS has a maturity period of five years, which can be extended for an additional three years. An extension application must be submitted in the fifth year of the account's tenure.

Multiple Accounts and Nominations

Individuals are permitted to open more than one SCSS account, either individually or jointly with their spouse. However, joint accounts can only be opened with a spouse, with the initial depositor considered the primary investor.

Account holders can appoint nominees during or after account opening.

Transferability and Premature Closure

SCSS accounts can be transferred between Post Offices and banks.

Premature closure is allowed, subject to penalties. If closed before one year, all interest paid is recovered from the principal. For closures between one and two years, a 1.5 per cent penalty on the principal is levied. After two years, the penalty is reduced to 1 per cent.

Required Documents for Opening SCSS Account

• Two passport-sized photographs.
• Identity proof (PAN card, Voter ID, Aadhaar, or passport).
• Address proof (Aadhaar, telephone bill).
• Proof of age (PAN card, birth certificate, or senior citizen card).
• All documents must be self-attested.

For more information, visit your nearest Post Office or authorised bank.