Post office schemes rules changed: Govt makes changes to PPF, Senior Citizen Savings Scheme (SCSS), 5-year time deposit
SCSS), Public Provident Fund (PPF) and 5-year post office time deposit.
Here is a look at the changes made to these small savings schemes.
Changes Senior Citizen’s Savings Scheme (SCSS)
The government has made 7 changes to the Senior citizen Savings Scheme:
1. More time to invest retirement benefits
A retired individual of more than 55 years of age but below 60 years of age will now have three months' from earlier one month time.
2. Investment by spouse of government employee
The new rules allow the spouse of a government employee to invest the financial assistance amount in the scheme.
3. Scope of retirement benefits defined
As per the notification, retirement benefit means any payment received by the individual due to retirement or superannuation. This includes provident fund dues, retirement or superannuation or death gratuity, commuted value of pension, leave encashment, savings element of group savings linked insurance scheme payable by the employer on retirement, retirement-cum-withdrawal benefit under Employees’ Pension Scheme (EPS) and ex gratia payments under a voluntary or special voluntary retirement scheme.
4. Deduction on premature withdrawal
As per the new rules, one percent of the deposit will be deducted if the account is closed before the expiry of one year of the investment.
5. No limit on the extension of SCSS
The account holder can continue to extend the account for n number of block — the block being of three years each. Further, the application has to be submitted for every extension. Earlier, the extension was allowed only once.
6. Interest on extension of scheme deposit
As per the new rule, in case the SCSS account gets extended on maturity, the deposit will earn an interest rate applicable to
