Union Budget 2023: Limit for Senior Citizens’ Savings Scheme raised to Rs.30 lakhs from the existing Rs.15 lakhs.

Union Budget 2023 hiked SCSS deposit limit to Rs.30 lakhs

Senior Citizens Savings Scheme

Touted to be the most awaited budget of the Government’s current tenure, the Union Budget 2023 had some good news for taxpayers and investors. The Finance Minister, Mrs Nirmala Sitharaman, hiked the deposit limit of the Senior Citizens’ Savings Scheme (SCSS) in her latest budget proposal. Compared to the limit of Rs.15 lakhs, the limit was increased to Rs.30 lakhs.

Moreover, the Government also fixed the interest rate on the SCSS scheme for the fourth and last quarter of the financial year 2022-23. The rate was fixed at 8% per annum.

About the Senior Citizens’ Savings Scheme

The Senior Citizens’ Savings Scheme is a fixed-income saving scheme targeted at senior citizens. The Government first introduced the scheme in 2004 with the objective of creating a source of regular income for senior citizens. The salient features of the scheme are as follows –

  • Senior citizens aged 60 years and above can deposit in the Senior Citizens’ Savings Scheme. However, if individuals have opted for VRS (Voluntary Retirement Scheme), the entry age starts from 55 years. For retired defence personnel, the entry age is 50 years to 60 years.
  • Only resident individual taxpayers can opt for the Senior Citizens’ Savings Scheme. Hindu Undivided Families (HUFs) or Non-Resident Indians (NRIs) are not eligible.
  • The minimum deposit amount is Rs.1000, while the maximum is Rs.30 lakhs.
  • The scheme is available to individuals who have received their retirement benefits. The scheme should be selected within a month of receiving the benefit.
  • The scheme has a term of 5 years which can further be extended by 3 years.
  • You can open an SCSS account with an authorized bank or post office.
  • The Senior Citizens’ Savings scheme's investment qualifies for a tax deduction under Section 80C. Though the deposit limit has been hiked, the deduction is available up to a limit of Rs.1.5 lakhs.

Related - PPF, SSY or SCSS? Find out which one is better.

What does the hike mean?

The Senior Citizens’ Savings Scheme is one of the most lucrative investment avenues for senior citizens, which gives guaranteed returns on their investment which currently stands at 8%. Senior citizens can, thus, invest in the scheme and enjoy a source of regular income. With the latest hike, senior citizens can invest more and enjoy a comfortable retirement.

What else did the Union Budget 2023 offer?

On the investment front, the Union Budget also introduced a new saving scheme called the Azadi ka Amrit Mahotsav Mahila Sammaan Bachat Patra. Targeted at women investors, the scheme will be open for the next two years, i.e., till March 2025. The scheme allows deposits up to Rs.2 lakhs with a maturity tenure of 2 years and a fixed interest of 7.5%. Moreover, the scheme will allow partial withdrawals to offer liquidity.

So, besides senior citizens, women investors also have something new to look forward to in the new budget proposals.

Related - Check out four investment avenues for senior citizens for good returns


Related Article

Premium Articles