Senior Citizens Saving Scheme (SCSS) is a government-supported investment scheme for individuals aged 60 and older to ensure financial well-being during their retirement years. Senior citizens can open the SCSS account at the post offices or authorized banks. Besides ensuring cash flow at retirement, the scheme is aimed at inculcating financial discipline. Let’s understand key Changes In SCSS Rules from redefined benefits and subscription timeframe to scheme extension.

SCSS Interest Rate For January-March Quarter

The government has left the SCSS rates unchanged for the January-March quarter of FY2023-24 at 8.2 per cent annually, the same for the third consecutive quarter. In the April-June quarter or the first quarter of FY2023-24, the interest rate was 8 per cent. Investors earn the pre-determined interest rates in each quarter—April, July, October, and January—based on their investments.

Advantages

The SCSS account holders earn guaranteed income risk-free as it is supported by the government. The application process is simple and one can open an account at any authorized bank and post offices. The government makes periodic changes to the interest rates. The account is transferrable pan-India and the deposits are subject to a tax deduction of up to Rs 1.5 lakh in a financial year under section 80C of the Indian Tax Act, 1962. It has a 5-year tenure but can be extended in blocks of three years indefinitely. It also provides a premature closure option. You can invest up to a maximum of Rs 30 lakh in the scheme.

Eligibility & Documents Required

People aged 60 and older as well as those in the 55-60-year bracket can apply for the scheme. Non-resident Indians (NRIs) and members of the Hindu Undivided Families are not eligible. To open the account, you will need a passport-size photograph, Aadhar card, PAN card, a Passport or Voter ID, a telephone bill, or a senior citizen card, etc., for verification.

Also Read: UTI Retirement Solution Pension Fund: Know Its NPS Performance And Portfolio

Recent Changes In SCSS Rules

Read the following changes in SCSS rules For January-March Quarter

Extended Timeframe: Retirees between 55-60 years had an initial window of one month to invest in the scheme after receiving the retirement benefits. It has now been extended to three months.

Eligibility Criteria For Spouses: The government changed the eligibility criteria for spouses of deceased government employees. If the employee is aged over 50 and dies on duty, the spouse is allowed to invest in the scheme, applicable to both central and state government employees.

Redefined Benefits: As per the revised rules, retirement benefits encompass provident fund dues, superannuation, gratuity, commuted pension value, leave encashment, etc.

Premature Withdrawals: The SCSS account holders previously received the entire deposit and interest amount; now, one per cent will be deducted for premature closure.

SCSS Extension: The account holder can extend the account indefinitely in blocks of three years.

Interest Rates On Extended Accounts: Extended accounts will earn interest as per the prevailing rates on the maturity date or the date of the scheme extension.

Payment on Maturity: The new rule allows withdrawals at the end of the maturity period, whether it is the initial investment period or the extensions.