Post Office Scheme- Like the bank, the post office also gives you the facility of fixed deposit scheme for one year, two years, three years and five years. Fixed deposit of post office is called time deposit.
new Delhi. The Time Deposit Scheme run by the Post Office is one such great scheme. In which the investor gets the benefit of compounding in it. Like the bank, the post office also gives you the facility of fixed deposit scheme for one year, two years, three years and five years. Fixed deposit of post office is called time deposit. Post office time deposits have different interest rates for different tenures.
This scheme is also called Post Office FD. Recently, the government had increased the interest rates of time deposit scheme by 30 basis points. Now in this scheme, an investor is being given an interest of up to 6.7 per annum. The special thing about this scheme is that in this the investor is given the opportunity to make short term and long term investment.
Who can open the account?
Any Indian citizen can open his account in the Post Office Time Deposit Scheme. Not only this, 3 adults together can also open a joint account. Parents can also open a time deposit account in the name of children above 10 years of age. An account can also be opened by investing Rs 1,000 in this.
Interest up to 6.7 percent
Different interest rates have been fixed for different periods of investment in Post Office Time Deposit. If an investor deposits money in this scheme for 5 years, then he will get interest at the rate of 6.7 percent per annum. On making a time deposit of three years, the investor will be given interest at the rate of 5.8 percent. Similarly, 5.7 percent interest is being given on 2-year time deposit. The lowest interest i.e. 5.5 percent interest is being given on one year time deposit.
Tax exemption will also be available
There is also the benefit of tax exemption under section 80C of the Income Tax Act, 1961 on the amount invested in a time deposit account with a tenure of 5 years in the post office. However, exemption of tax benefits is not being availed on deposits of less tenure than this. Money can be withdrawn even before the maturity of the time deposit, but a penalty is levied.
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