Saving Income Tax by investing in the future of your Girl Child

The government has introduced a Sukanya Samriddhi Scheme for the benefits of a girl child in the society. It aims at motivating people to utilise the scheme for the betterment of their girl child.

About SukanyaSamriddhi Scheme

Prime Minister Narendra Modi launched the Sukanya Samriddhi Scheme in 2015 helping and promoting the potential of the girl child in every family. Under the campaign, Beti Bachao, Beti Padhao campaign, the government has taken this significant step to create investments and give a financial platform to the daughters of the country.

Features of Sukanya Samriddhi Scheme
  1. Flexibility in investment: The parents or the guardian can make flexible investments no matter how less or more their budget is. The investments can range from Rs. 1000 to Rs. 1.5 lakh per year.
  2. Multiple accounts opening avenues: One can open Sukanya Samriddhi Scheme in any of the nationalised banks or a post office nearby. The flexibility in investments and locations ensure more investments for the girl child in the country.
  3. One account for one daughter:The parents or the guardians are allowed to open only one account in the name of one girl. Thus, for a family with two girl children, a maximum of two accounts are permitted.
  4. Age: The account can be opened before or when the girl reaches the age of 10. No account is allowed to be open after her being ten years old.
  5. Account maturity: One can expect the Sukanya Samriddhi account to mature after 21 years of its activation. However, one can continue earning interest on the same even after 21 years.
  6. The operation of accounts: After the girl child reached 10 years of age, she has the right to handle money independently and can operate the account herself.
Benefits of Sukanya Samriddhi Scheme
  • Tax benefits: The government offers tax incentives to promote investments. The parents or the guardians receive tax benefits U/S 80C under the income tax act. Further, when the girl withdraws the amount on maturity, the entire income is tax-free. Thirdly, the interest accrued on the investment is also exempted creating a three-time tax benefit for the parents.
  • Interest rates: One earns high-interest rates on such investments. Currently, the interest rate persists at 9.2% which is higher than any other deposit or saving investment you might make.
  • Withdrawal scheme: A Partial withdrawal can be done when the girl attains 18 years of age. She can withdraw 50% of the amount if she wishes to study or marry further.
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