There are a lot of securities available to you to reduce your tax liability .Chapter VIA offers you so many opportunities. Sec 80 C is one of the important section in Chapter VIA which gives ample opportunities to you as per the existing Income Tax Act. You cannot claim deduction under Sec 80C under the New Option as per the finance bill of 2020 February. Sukanya Samridhhhi Yojana is one of the important tax saving investment opportunity available to the parents of girl children. Sukanya Samridhhhi yojana is not only a tax saver but also an investment avenue to the parents of girl children
The eligibility for Sukanya Samriddhi account includes: Only girl children are eligible to hold Sukanya Samriddhi account. The maximum age of a girl child should not be more than 10 years. A proof of age of the girl child needs to be attached. Since its launch in 2015, the scheme could become one of the important opportunity to the targeted population .It is more apt to low income people and middle income people.
Following are the features of scheme that makes it more popular among the masses
1. Parents can make a deposit ranging from Rs 250 to 150,000 per annum for a period of 15 years
2. Annual Interest rate is 8.4 percent (Latest)
3. Defaulting account holders also get high rate of interest .ie 8.4 percent as per the New Rules of 2019
4. Account holders also get cash at times of medical emergencies as per the New Rules of 2019
5. Premature closure is permitted under compassionate grounds as per the new rules of 2019.
Pre –December 2019 System, pre mature account closures were allowed only in the following two cases
a. death of the girl child
b. change of her residential status
6. Normal Closure is permitted under the following circumstances.
a. After the Marriage of Girl Child
b. At maturity .
7. The parent has to make contributions for 15 years. It matures at 21 years from the date of account opening by the parent for the girl child. But interest will get during the 6 years (15 years to 21 years)
8. In case of change of residency status or the account holder ceases to citizen of India, the account will deemed to be closed .But the amount remains in the account and he will get post office saving bank account interest from the date of closure to his date of withdrawal.
9. The account can be opened in any post office or authorized branches of commercial banks.
10. The account will remain operative for 21 years from the date of its opening or till the marriage of the girl after she turns 18.
11. Partial withdrawal is possible in the following cases.50 Percent can be withdrawn
a. For educational purposes after standard X
b. For marriage related expenses
Following Table shows previous interest rates offered by the scheme
| Interest rate for the period | Interest rate |
| From April 1, 2014 | 9.1% |
| From April 1, 2015 | 9.2% |
| From April 1, 2016 -June 30, 2016 | 8.6% |
| From July 1, 2016-September 30, 2016 | 8.6% |
| From October 1, 2016-December 31, 2016 | 8.5% |
| From July 1, 2017- December 31, 2017 | 8.3% |
| From January 1, 2018 – March 31, 2018 | 8.1% |
| From April 1, 2018 -June 30, 2018 | 8.1% |
| From July 1, 2018 -September 30, 2018 | 8.1% |
| From October 1, 2018 – December 31, 2018 | 8.5% |
| From January 1, 2019 – March 31, 2019 | 8.5% |
As per Income tax point of view, following are the important points you have to understand before making investment in Sukanya Samriddhi Account.
1. You will get deduction under Sec 80C if you do not claim option as per New Finance bill 2020.If you claim option under Finance bill, you cannot claim deduction under Sec 80C
2 Maturity amount will be tax free .That means it is not taxable under the following heads
a. Income from salaries
c. Income from Business or Profession
d. Income from Capital Gains
3. Interest earned in the Sukanya Samriddhi accountwill be exempt from Income Tax
That means it is not taxable under the following heads
a. Income from salaries
b. Income from House Property
c. Income from Business or Profession
d. Income from Capital Gains.
e. Income from other sources.
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