The National Savings Certificate (NSC) is a fixed-income investment scheme that can be opened at any post office branch in India is a major initiative by the government to motivate people of lower income group to middle class group to invest more than savings in normal savings account in banks.
NSC is a savings option in INDIA that is safe and secure and any can avail of it from the Indian Post Office. So it ensures the safeguard of your hard-earned money. In NSC the minimum saving amount is Rs.500 and there is no maximum deposit limit as per the scheme. The applicant gets the interest in their registered bank account at the end of the financial year. Interest earned of Rs 10,000/- in a financial year is exempted from taxable income under section 80TTA of income tax.
Know some unknown facts about NSC
• In India NSC can be opened in any branch of the post office only.
• It is a low-risk investment option backed by the Government of India.
• The minimum deposit amount is INR 500, and there is no maximum limit for deposits.
• Interest is calculated between the 10th of the month and the end of the month and it is credited to the applicant before the financial year ends.
• Interest earned up to INR 10,000 in a financial year is exempted from taxable income under Section 80TTA of the Income Tax Act.
As of January 2024, the interest rate of the NSC investment is 7.7% per annum which is compounding in nature and it may vary from time to time as per the Finance Ministry decision.
What will be the maximum time frame of investment?
The maturity term of NSC is 5 years. Applicant gets the maturity benefit with compounding interest.
What is the minimum age to open an NSC account?
The NSC scheme can be opened by any citizen of India above the age of 10 years.
Is there any limit to depositing the maximum amount in the scheme?
There is no maximum limit for the amount that can be invested in the National Savings Certificate (NSC)
What is the difference between NSC and PPF?
National Savings Certificate and PPF Public Provident Fund both are offered by Govt of India having a fixed income and a good return scheme that is reliable.
The major differences between NSC and PPF are explained below :
• Tenure: NSC has a maturity period of 5 years on the other hand PPF has a lock in 15 years
• Interest rate: The present interest rate of NSC is 7.7 % per annum and the current interest of PPF is 7.1% per annum and both schemes provide compounding interest.
• Investment Limit: In the case of NSC there is no maximum amount of investment in the scheme and the minimum amount of investment is Rs 500. But on the other hand in the case of PPF, the maximum amount of investment is 1.5 lakh per annum
• Tax Benefit: The amount matured in NSC is taxable. Interest income earned on NSC is taxable. On the other hand, interest earned on the PPF is tax-free under section 80c
Both the investment scheme provides growth in capital and guaranteed interest earning in the prescribed tenure. However, the choice between the two depends on the investor’s financial goals and investment horizon.
FAQ
Certainly! Here are 10 frequently asked questions about the National Savings Certificate of Post Office:
Can you explain NSC?
The National Savings Certificate stands out as a reliable fixed-income investment option extended by the Indian Post Office. This investment avenue not only offers the assurance of a secure financial endeavor but also comes with the added advantage of tax benefits under Section 80C of the Income Tax Act. Notably, being backed by the Government of India further underscores the credibility and safety associated with the National Savings Certificate.
What will be the minimum amount of investment?
As per the scheme, the minimum amount of deposit is Rs 500
What is the interest of NSC?
As per the latest update interest rate for the scheme is 7.7 %
What is the maximum deposit limit for the NSC?
There is no maximum deposit limit in NSC
What is the minimum withdrawal amount from NSC?
The minimum withdrawal amount from NSC is Rs 500.
What is the duration of investment in NSC?
It is for 5 years.
Can I transfer my NSC account to other post offices?
Yes, transferring of NSC account is possible.
Is the amount matured is taxable?
No, NSC maturity is not tax-free only the interest earned is taxable.
Can I take NSC from a private sector BANK?
No, NSC can be taken only from the post office.
