Post Office Monthly Income Scheme: The Post Office Monthly Income Scheme is one of the saving instruments run by the Government of India, which guarantees monthly income to its investors. This scheme suits those persons who wish to earn regular monthly income with a safe investment.
Key Features Of Post Office Monthly Income Scheme
- Interest Rates: The quarterly interest rate for POMIS from January to March 2025 is 7.4% on an annual basis, which is paid monthly.
- Minimum-Maximum Investment: The minimum investment under this scheme can be ₹1,000. The maximum investment limit for an individual account is ₹9 lakh, while for a joint account, it is ₹15 lakh.
- Maturity Period: The maturity period for POMIS is 5 years. Thereafter, the investor may withdraw the principal amount or reinvest.
- Types of Accounts: The scheme is available for single and joint accounts, wherein a maximum of 3 persons can be accommodated under a joint account.
Interest Payment
Interest is paid monthly, with monthly interest payments commencing a month from the date of opening the account. Online transfer to the investors’ savings account is possible, as is the receipt of this payment through post-dated cheques.
Taxation
Income earned under this scheme is taxable under the Income Tax Act; however, TDS is not applicable. The income from interest on the scheme has to be included by the investor in the computation of total income for filing of return of Income.
Pre-mature Withdrawal
Withdrawal of money before the end of the stipulated period is permitted, yet the following provisions will apply:
- Withdrawals are not allowed within the first year.
- If cash is withdrawn after one year but before three years, a penalty at the rate of 2% of the principal amount will be charged.
- Withdrawals after three years but before the completion of five will attract a penalty of 1%.
Account Opening Procedure
- Proceed to the nearest post office to avail the application form.
- Fill out the form along with the required documents- identity proof, address proof, and passport-size photo.
- Deposit the minimum ₹1,000 or above.
- Receive the account number and passbook.
Benefits Of POMIS
- Safe investment: This scheme is guaranteed by the government, so it is safe for the capital.
- Regular source of income: Monthly interest payments are a steady source of income for retirement or investing individuals.
- Simple: Opening and operating the account is a simple process.
In conclusion, the Post Office Monthly Income Scheme makes for a safe and secure investment with regular monthly payouts to investors. Based on your financial needs and objectives, consider investing in the scheme.
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