Post Office - Now you will not get interest in this scheme of Post Office, the government has changed this rule
Post Office - Many small savings schemes are operated under the post office, in which the rules keep changing from time to time. In this episode, the government has made changes in this scheme of the post office... Read the news completely to know the complete information related to this update.
The Kalamkar News:- (Post Office Scheme) Many small savings schemes are operated under the post office, in which the rules keep changing from time to time.
Recently there has been an important change, in which it has been decided to stop paying interest on deposits under the National Savings Scheme (NSS).
The central government has directed that depositors should withdraw their money by 30 September 2024. Along with this, it has been told that from October 1, 2024, no interest will be paid under the NSS scheme.
Instructions to withdraw money-
According to the guidelines issued by the government, depositors who had invested in the National Savings Scheme more than 37 years ago with the intention of securing their financial future and future generations have been advised to withdraw their entire amount by September 30, 2024.
Because the payment of interest on their deposited funds will be stopped. Customers have also been asked to update KYC information.
NSS scheme is different from NSC -
Investors need to understand that National Savings Scheme (NSS) and National Savings Certificate (NSC) are two different schemes.
NSS was closed for new investments in 1992, and its interest will also stop from October 1, 2024, while no change has been made in NSC.
The interest rate of NSS was 7.5% per annum from March 2003 to September 30, 2024. People investing in NSC do not need to worry as this scheme is ongoing and investment can be continued in it.
When did the scheme start?
The National Savings Scheme (NSS) was launched in 1987 and continued till 1992. It was then temporarily reopened, but was finally closed in 2002.
Even after its closure, the government continued to pay interest on existing deposits. During the scheme, many depositors chose to withdraw their money, close the account and declare it taxable. Some investors decided to keep their funds in an active account, which continues to operate today.
Under the NSS, depositors had the opportunity to invest up to ₹40,000 annually, with the amount invested being eligible for tax deduction under Section 80C of the Income Tax Act, 1961.
After a lock-in period of four years, depositors were allowed to withdraw both their principal deposit amount and the interest earned. Earlier, the scheme offered 11 per cent interest, which was later reduced to 7.5 per cent per annum.
Accounts before October 2024 –
If you have contributed to your NSS account before October 1, 2024, you will get interest at the rate of 7.5% per annum till the end of September 2024.
Accounts after October 2024-
No interest will be paid for any new deposits or accounts opened after October 1, 2024. This information may influence your decision whether you should continue investing in NSS or explore other savings and investment options.
Tax rules-
Funds withdrawn from the NSS are subject to tax in the year in which they are withdrawn.
If the depositor does not withdraw the funds, the interest earned remains tax-free as long as it is in the account. If the depositor dies and the heirs withdraw the funds, the entire amount is also considered tax-free, which is beneficial.