logo
#

Latest news with #PPF

From PPF to SCSS: 5 Government Savings Schemes That Secure Your Future
From PPF to SCSS: 5 Government Savings Schemes That Secure Your Future

News18

time8 hours ago

  • Business
  • News18

From PPF to SCSS: 5 Government Savings Schemes That Secure Your Future

Last Updated: With rising inflation and uncertain markets, individuals are advised to turn to low-risk, government-supported savings plans for financial stability. As more Indians seek low-risk ways to grow their savings, government-backed schemes have become a cornerstone of sound financial planning. Backed by the Government of India, these schemes offer assured returns, tax benefits and much-needed peace of mind, making them ideal for conservative investors, senior citizens and first-time savers. In today's unpredictable market, government-backed instruments are valuable for long-term goals like retirement planning, child education and wealth preservation. Popular schemes like the Public Provident Fund (PPF), National Savings Certificate (NSC), Senior Citizens Savings Scheme (SCSS) and the Sukanya Samriddhi Yojana not only offer attractive interest rates but also come with tax-saving benefits under Section 80C of the Income Tax Act. If you are also planning or looking for government-backed savings schemes, here are five reliable options worth considering: Public Provident Fund (PPF) Ideal for long-term wealth creation, this government-backed savings scheme offers a current interest rate of 7.1 percent per annum, with a 15-year lock-in period. Contributions up to Rs 1.5 lakh per year qualify for tax deductions under Section 80C, and the interest earned is completely tax-free. Amazing, isn't it? If interested, you can start a PPF with a minimum annual investment of Rs 500 to Rs 1.5 lakh. With a 5-year tenure and an interest rate of 7.7 percent, the NSC is suitable for risk-averse investors. It also offers tax benefits under Section 80C on investments of up to Rs 1.5 lakh, making it a popular choice for small savers. To start this scheme, a minimum deposit of Rs 1000 is required and thereafter in multiples of Rs 100. Senior Citizens Savings Scheme (SCSS) Tailored for individuals aged 60 and above, SCSS offers one of the highest interest rates among government schemes at 8.2 percent per annum, payable quarterly. It has a five-year tenure (extendable by three years) and is ideal for retirees seeking regular income. The Senior Citizens Savings Scheme allows only one deposit. The minimum investment is Rs 1,000, and the maximum is up to Rs 30 lakh. Sukanya Samriddhi Yojana (SSY) Another government-backed saving scheme you can consider is Sukanya Samriddhi Yojana. Designed to secure the future of the girl child, Prime Minister Narendra Modi launched the scheme that offers an attractive 8.2 percent interest rate and tax-free returns. Parents can open the account any time before the girl turns 10, with partial withdrawals allowed for education and full maturity benefits after 21 years. Atal Pension Yojana (APY) Aimed at providing a fixed monthly pension to workers in the unorganised sector, the APY scheme offers a monthly pension from Rs 1,000 to Rs 5,000 upon attaining the age of 60. The scheme, named after the former Prime Minister of India, Atal Bihari Vajpayee, encourages individuals to save for their retirement systematically. Those individuals who are within the age group of 18-40 years are eligible to apply for the scheme. view comments Disclaimer: Comments reflect users' views, not News18's. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.

Senior Citizen Savings Scheme VS Public Provident Fund: Key Differences
Senior Citizen Savings Scheme VS Public Provident Fund: Key Differences

News18

time12 hours ago

  • Business
  • News18

Senior Citizen Savings Scheme VS Public Provident Fund: Key Differences

Last Updated: Differences Between Senior Citizen Savings Scheme and PPF, Senior Citizen Savings Scheme, Public Provident Fund, SCSS Benefits, PPF Features Senior Citizen Savings Scheme (SCSS) and Public Provident Fund (PPF) are both popular money-saving and investment tools used by Indian citizens for stability and future financial goals. It is common for salaried employees and those seeking retirement welfare to safeguard their money in these two schemes because of the range of benefits they come with, catering to a wider section of society. While diversifying your investment portfolio with both PPF and SCSS can be beneficial, what if you had to choose one of the two schemes? Here are the key differentials for you to understand. The goal with investments in the Public Provident Fund is to accumulate wealth and build a significant retirement corpus. With the Senior Citizen Savings Scheme, those nearing the end of their professional life can get a regular income stream. While the PPF is open for all Indian citizens, the SCSS is specifically designed for senior citizens aged 60 years and above. Investment Tenure Public Provident Fund investments are fixed over a tenure of 15 years that you can extend in blocks of up to five years. On the other hand, the Senior Citizen Savings Scheme has an initial tenure of five years, which can be stretched for an additional period of 3 years. The interest rate on PPF investment currently stands at 7.1 per cent per annum, compounded annually. The Indian government reviews the interest rates on PPF every quarter. SCSS offer a higher return of 8.2 per cent annually, which is also subject to periodic revisions. Tax Benefits Investments in the PPF scheme up to a maximum limit of Rs 1.5 lakhs per financial year are eligible for tax deductions under the Indian government's Income Tax Act Section 80C. Both the interest earned and maturity amount are tax-exempt, giving it an edge over the SCSS. While contributions to the Senior Citizen Savings Scheme also fall under the Income Tax Act benefit, the deductions are subject to the overall limit and the interest earned is taxable. Minimum Investment and Withdrawal The maximum PPF investment may be Rs 1.5 lakhs, but you can start a PPF account with a minimum sum of Rs 500. The minimum deposit required for the SCSS scheme is Rs 1,000, with a maximum limit of Rs 30 lakhs. Withdrawals are allowed under both the schemes. Investors can make partial withdrawals from the 7th year onwards under PPF, subject to certain conditions. Full withdrawals are only allowed upon maturity. You can make premature withdrawals from SCSS upon completion of one year with due penalties deducted. view comments First Published: July 24, 2025, 09:00 IST Disclaimer: Comments reflect users' views, not News18's. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.

Top 5 income tax saving options with low or no lock-in periods
Top 5 income tax saving options with low or no lock-in periods

Mint

time2 days ago

  • Business
  • Mint

Top 5 income tax saving options with low or no lock-in periods

As the date of income tax submission nears, taxpayers across the country are actively seeking ways to bring down their taxable income without locking in their funds for years. While many popular investment instruments such as Public Provident Fund (PPF), Equity Linked Savings Scheme (ELSS) among others require long term commitments, several provide quick liquidity, lower risk and efficient Section 80C or other related deductions, thus making them ideal for those aspiring to prioritise financial flexibility. Keeping the same factors in mind below are five tax saving options that investors can avail without decadal or very long lock in periods and ensure that they are able to save money smartly. Several banking institutions provide 5 year tax saving fixed deposits (FDs) under Section 80C. Given these fixed deposits do have a five year lock in period, still they also provide premature liquidity in emergencies through a personal loan or overdraft, unlike PPF or NPS. Do keep in mind, the interest earned on such deposits is taxable, but the principal invested qualifies for deduction up to ₹ 1.5 lakh. Health insurance continues to be a reputable tax saving recommendation by banking institutions and financial advisors. Premiums of up to ₹ 25,000 ( ₹ 50,000 in case of senior citizens) are deductible under Section 80D. It is also important to note that there is no lock in and deductions can be claimed every year upon renewal, making it one of the most lucrative and flexible options. For salaried individuals, all contributions made to the Employee Provident Fund (EPF) automatically qualify for Section 80C deductions. Though EPF has a retirement oriented vision and structure, still partial withdrawals are permitted for marriage, education, home ownership and medical emergencies such as serious surgeries and procedures. Thus providing partial liquidity without breaking the investment. The repayment of home loan principal amount qualifies under Section 80C. The interest up to ₹ 2 lakhs is deductible under Section 24(b). There's no fixed lock in and deductions can be claimed yearly throughout the tenure of the home loan. It remains one of the most utilised tax saving strategies for home owners. National Pension System (NPS) provides deductions under Section 80CCD(1B) of up to ₹ 50,000 over and above the deduction provided under Section 80C. Though tier I is long term, tier II accounts offer flexible withdrawals. Do keep in mind that tier II is tax exempt only for government employees. Withdrawal of partial amounts are also permitted after three years under specific terms and conditions. Disclaimer: This article is for informational purposes only and should not be considered financial or tax advice. Please consult a qualified tax advisor or financial planner before making any investment or tax-saving decisions.

ELSS funds: Go-to scheme for tax saving loses traction as new tax regime picks favour; Rs 1,600 crore outflows in Q1 FY26
ELSS funds: Go-to scheme for tax saving loses traction as new tax regime picks favour; Rs 1,600 crore outflows in Q1 FY26

Time of India

time6 days ago

  • Business
  • Time of India

ELSS funds: Go-to scheme for tax saving loses traction as new tax regime picks favour; Rs 1,600 crore outflows in Q1 FY26

Once a go-to choice for tax-saving investments, equity-linked savings schemes (ELSS) are slowly slipping off investors' radar. More taxpayers are pulling out of the ELSS as they are switching to a new tax regime, which provides no tax benefits under section 80C, according to an ET report. Data for the first quarter of FY26 reveals net outflows of Rs 1,616 crore from ELSS funds, indicating a drying up of fresh inflows and increasing withdrawals from investors whose three-year mandatory lock-in period has ended. Over the past 12 months, ELSS schemes managed a modest net inflow of Rs 535 crore, against the Rs 56,309 crore that poured into the flexicap category during the same period. "Many taxpayers have switched or are switching to the new tax regime, which is now very much attractive," Gautam Nayak, partner at CNK and Associates was quoted as saying. "Since there are no tax benefits available under Section 80C, these investors would not want to invest in ELSS schemes and lock in their investments for 3 years." Why did people prefer ELSS earlier? Traditionally, ELSS was favoured for offering a shorter lock-in compared to other tax-saving products like Public Provident Fund (PPF), National Savings Certificates (NSC), and five-year tax-saving fixed deposits. Being equity-oriented, it also offered superior returns. Under the old tax regime, investors could invest up to Rs 1.5 lakh annually in ELSS and claim deductions under Section 80C. But the appeal seems to be fading over time. Since the past year, ELSS has registered the slowest growth among equity funds, with assets under management (AUM) rising just 6.9%, from Rs 2.33 lakh crore to Rs 2.49 lakh crore. In contrast, total equity scheme AUM grew by nearly 22%, from Rs 26.82 lakh crore to Rs 32.69 lakh crore. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now

PPF, Sukanya Accounts May Be Frozen After Maturity. Check What You Must Do In Time
PPF, Sukanya Accounts May Be Frozen After Maturity. Check What You Must Do In Time

News18

time6 days ago

  • Business
  • News18

PPF, Sukanya Accounts May Be Frozen After Maturity. Check What You Must Do In Time

Last Updated: Accounts that are not extended for reinvestment or closed within three years of maturity will be frozen, as per the advisory, restricting any further access or transactions The Postal Department has issued an important advisory for investors in popular small savings schemes like the Sukanya Samriddhi Yojana, Public Provident Fund (PPF), National Savings Scheme, and the Senior Citizen Savings Scheme. The department has warned that discrepancies or errors in managing these accounts could lead to them being frozen, restricting all withdrawals and transactions until the issues are resolved. The advisory highlights that accounts which have not been extended for reinvestment or closed within three years of maturity will be at risk. If three years have passed since the maturity date and no action has been taken, the department will freeze these accounts. Consequently, account holders will be unable to access their funds. This measure is designed to protect accounts from fraudulent activities. The Postal Department states that inactive accounts are vulnerable to scams, and freezing them is a preventive step to safeguard investors' money from illegal withdrawals. The department stated that this process will now be carried out twice a year to safeguard investors' hard-earned money. Investors in small savings schemes should note that within three years of maturity, they must either withdraw the funds or reinvest them to avoid complications. The accounts under scrutiny include PPF, Sukanya Yojana, NSC, RD, fixed deposits, monthly income schemes, Kisan Vikas Patra, and the Senior Citizen Savings Scheme. Once frozen, these accounts will be inaccessible for any transactions, including online transfers. How Can The Account Be Reactivated? For reactivating a frozen account, the Postal Department has provided a clear procedure. Account holders must visit the postal office and submit their account passbook, KYC documents, and account closure form SB 7A. The account will then be closed, and the remaining balance will be handed over to the account holder. Account freezing will be carried out twice a year, on January 1 and July 1, as per the new schedule. The entire freezing process will be completed within 15 days. view comments First Published: July 18, 2025, 16:21 IST Disclaimer: Comments reflect users' views, not News18's. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store