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Senior citizen saving scheme account

Senior citizen saving scheme account. Who can open?. An individual who has attained the age of 60 years

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Senior citizen saving scheme account

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  1. Senior citizen saving scheme account

  2. Who can open? An individual who has attained the age of 60 years An individual who has attained the age of 55 years or more but less than 60 years and who has retired on superannuation or otherwise can open within one month of the date of receipt of retirement benefits. The retired personnel of Defence Services (including Civilian Defence Employees) shall be eligible to open account under the scheme irrespective of the above age limit subject to the fulfilment of other specified conditions.

  3. Clarification:- In case of individuals who has attained the age of 55 years or more but less than 60 years and who retired on superannuation or otherwise, a question was raised as to how to calculate one month period after receipt of retirement benefits when benefits received in piece meal on different dates. It was clarified that such retired persons can open account within one month of receipt of retirement benefits each time subject to the maximum limits prescribed above.

  4. Who can’t open? HUF/NRI/Power of Attorney Holder/Firm/ Institution/Bank/Any autonomous body etc. cannot open any type of savings account in Post Office Savings Bank. If a depositor after opening of account become NRI, the account can be continued till maturity but should not be further extended.

  5. Types of SCSS Account (a) Single account (b) Joint account

  6. Joint account Joint account can be opened with spouse (Husband or Wife)only and not with any other person. It may be either operated by them (i) Jointly or by survivor(s) called Joint-A (ii) Either or survivor called Joint-B. The whole amount of investment will belong to the 1st applicant/depositor only. The question of any share of the second applicant/depositor does not arise.

  7. Number of SCSS Accounts An individual can open any number of single or Joint accounts in one post office subject balance of maximum amount of Rs.15 Lac in all accounts . More than one account shall not be opened in the same deposit office during a calendar month. Both the spouses can open individual and/or joint accounts with each other with the maximum deposit up to Rs.15 Lac each.

  8. Minimum amount required for opening of SCSS account A SCSS account can be opened with minimum deposit of Rs. 1000/-(One thousand) and account can be opened in multiple of Rs.1000/-.

  9. Maximum balance in SCSS Account Maximum amount that can be invested in single or Joint account is Rs.15 Lac. For this limit, balance in all types of SCSS accounts held by the depositor in all post offices will be taken together. For the purpose of maximum balance, the whole amount of investment will belong to the first depositor. In case of accounts opened by an individual who has attained the age of 55 years or more but less than 60 years and who has retired on superannuation or otherwise on the date of opening the account the maximum limit of investment is limited to the amount received as retirement benefits or Rs.15 Lakh whichever is lower.

  10. TRANSFER OF ACCOUNT If the application for transfer of account is presented at the counter, the Counter PA will verify the signature of applicant from office record, after tallying balance in the Passbook, issue receipt to the depositor. In case of any discrepancy, Passbook will be retained and receipt from SB-28 will be issued to the depositor. Process of transfer of account should then be followed. Where the deposit is Rs. 1 lakh or above, a transfer fee of Rs.5/- per lakh of deposit for the first transfer and Rs.10/- per lakh of deposit for the second and subsequent transfer shall be payable.

  11. TRANSFER OF ACCOUNT........ • The fee will be paid by cash through pay-in- slip (Form D) by the depositor. • The account can be transferred from one deposit office to another deposit office i.e from post office to a bank and from bank to post office. • The procedure prescribed for such transfer in PPF scheme will be followed.

  12. Continuation of account after death of the depositor In case of joint account or where spouse is the sole nominee, the spouse may continue the account on the same terms and conditions even if the spouse is below the age of 60 years. Where both spouses have opened separate account(s) and either of the spouses dies during the currency of account(s), the account(s) standing in the name of the deceased depositor spouse shall not be continued and such accounts shall be closed.

  13. ………… In simple terms, nominee or joint account holder cannot continue the account after death of the depositor if he/she has opened a separate account. Example:- Suppose, A & B are spouses (husband & wife or wife & husband) and they have opened Joint account(s), (i) in the name of A (first depositor) and B (second depositor) and in some (ii) Other account(s), B (first depositor) and A (second depositor)

  14. ………… A dies, the B cannot continue the accounts opened in case if (i) above as A has already other joint account with B. Similarly, if A opened single account(s) with B as sole nominee, B can continue the account(s) even if B is below the age of 60 years. But if B has also opened account(s) either single or joint with A, B cannot continue the account. If A has opened single account(s) with C i.e other than spouse as nominee, C cannot continue the account(s) in case of death of A.

  15. Issue of Duplicate Passbook If the original passbook of a depositor is lost or mutilated or damaged, he/she should be required to make an application either on plain paper or in the prescribed format. A fee of Rs.10/- is required to be paid in cash through pay-in-slip (Form D). In case of joint account either ‘A’ type or ‘B’ type, both depositors have to sign the application form.

  16. Issue of Duplicate Passbook...... In case of subsequent issue of duplicate passbook, the fee will be Rs.20/-. In case passbook is lost from the custody of post office, no fee should be charged from the depositor. If the lost passbook is found after issue of a duplicate passbook, it shall not treated as valid for any purpose and shall have to be surrendered to the deposit office who shall destroy the same immediately in the presence of depositor.

  17. Supply of ledger copy A depositor may, on payment of a fee of two rupees for every thirty entries or part thereof, obtain copy of his SCSS account as appearing in the ledger of the Post Office Savings Bank for any period for which such ledger is available.

  18. Extension of account after maturity The depositor can extend the account for further period of three years by making an application in Form-B to the deposit office within the period of one year from the date of maturity period of five years. Extension of account shall be automatically treated from the date of maturity irrespective of the date of application.

  19. If account is neither closed on maturity nor extended within one year. In case the depositor does not close the account on maturity and also does not extend the account for period of three years within the period of one year after maturity, the account shall be treated as matured and can be closed any time with Post - maturity interest @ Savings Bank Account rate for the completed months from the date of maturity to date of payment. For the purpose of payment of interest, any part of the period which is less than one month shall be ignored. The amount of excess interest paid if any (scss interest) after maturity shall be deducted

  20. Account opened in contravention of rules If at any time after opening of account, it came to notice that an account has been opened in contravention of rules, the account shall be closed immediately and the deposit after deduction of interest, if paid any, shall be refunded to the depositor.

  21. Power to relax rules The Ministry of Finance, Department of Economic Affairs, Budget Division, North Block, New Delhi on behalf of the Central Government can relax the any requirement which is not inconsistent with the provisions of the Act If it is satisfied that operation of any of the provisions in the rules has caused undue hardship to the depositor. For this, it has to issue an order with reasons for relaxation to be recorded in writing.

  22. In case the amount deposited is found above the prescribed ceiling A deposit office shall, as soon it comes to its notice that a deposit exceeds the ceiling prescribed in the rules i.e Rs.15 Lakh, request the depositor in writing to withdraw the excess deposit immediately. The amount deposited in the account in excess of the prescribed limit will be refunded with interest at the rate applicable to savings account from the date of deposit to the end of the month preceding the month in which the deposit office issues request to the depositor to withdraw the excess amount. The SCSS interest paid if any on the excess amount will be adjusted from the amount payable.

  23. Benefit under section 80C of Income Tax Act. The deposits made under this scheme are eligible for investment allowed for the Income Tax benefit under Section 80C of Income Tax Act within the maximum limit of investment.

  24. Provision of TDS from interest of SCSS account. TDS from the Interest payment if the total amount of interest paid in a financial year exceeds Rs.10,000/-. No TDS will be deducted if the amount of interest paid in a financial year does not exceed Rs.10,000/-. If the amount of total interest paid exceeds Rs.10 Lakh in a financial year, a surcharge @10% on the TDS is to be deducted. The amount of TDS+ surcharge (if any) shall be further increased by 3% for the purpose of education cess.

  25. Form 15 G and 15-H as applicable and as amended from time to time is required to be furnished by the depositors once in a financial year in respect of interest drawn during the financial year. This form is to be furnished in duplicate. The second copy of the form will be sent by the incharge of the deposit office concerned to the Income Tax authorities within a week after close of the month. The depositor should give his complete postal address in Form 15-G or H. If the depositor or agent does to attend the post office to receive the certificate within the prescribed time limit postmaster will send the certificate to him by ordinary post on his latest address available in the post office record.

  26. The tax deducted on the interest paid / payable will be noted in remarks column of the pass book/ledger and at the top of the withdrawal form under the dated signature of the APM / SPM. • After the close of the day, a schedule will be prepared from the withdrawal forms in the HO / SO. • The schedule will be prepared in triplicate in sub offices and two copies will sent to HO along with forms 15 G and 15 H in support of amount charged in the daily account and SO account. • The third copy of the schedule will be filed in a separate guard file to be opened for each financial year. • The third copy will be retained in HO.

  27. In the Head Office the consolidated schedule will be prepared in triplicate incorporating the transactions of the HO and sub offices as a whole. • In HO, after the close of the month, one copy of schedule will be sent to the Postal Account Office along with cash account. • The second copy will be sent to the Commissioner of Income Tax along with Forms 15G or 15H.

  28. The schedules will be checked by the APM incharge and preserved up to 5 years. TDS certificate in form 16A should be prepared in duplicate and receipt of the depositor should be obtained on the office copy. The guard file containing the office copied of certificates issued will be preserved for 5 years. MOF(DEA vide its ID No. 15/1/2009-NS-II dated 25.5.2009 has clarified that the nominee can also produce 15-G Form (declaration of non-deduction of Tax from the amount of interest payable to him at the time of payment after death of depositor) as clarified by CBDT, Deptt. Of Revenue, New Delhi vide O.M.No. 275/36/2009-IT(B) dated 14.5.2009.

  29. Issue of TDS Certificate • The TDS certificate is to be issued to the depositor in Form 16-A within a week after the expiry of two months from the month in which tax is deducted OR a consolidated TDS certificate for the whole financial year may be issued within one month of the end of the financial year on request from the payee.

  30. In this form TAN (Tax deduction Account Number) of the authority issuing the certificate is required to be mentioned. Under the scheme the Sub Postmasters will also issue the TDS certificate and they will mention the TAN (Tax deduction Account Number), of the Postmaster allotted to them by the Income Tax Authorities.

  31. No TDS will be made in the following cases • If a declaration in Form 15-G is furnished by a depositor of less than 65 years of age that the tax on his estimated total income for the financial year is NIL and the aggregate amount of interest credited or paid during the financial year is not more than the maximum amount which is not chargeable to tax

  32. If the depositor of 65 years of age or above furnishes a declaration in Form No. 15-H that the tax on his estimated total income for the financial year is NIL

  33. Thank You

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