All about Sukanya Samriddhi Yojana(SSY)

Sukanya Samriddhi Yojana is the result for promoting girls’ welfare in India. This also helps in saving tax. So must read about it till end and get to know all about it in detail!

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In this scheme, the depositor is an individual who on behalf of a minor girl child of whom he or she is guardian and deposits amount in account opened under this scheme.

Maximum number of Accounts :

Natural or legal guardian is allowed to open one account each for two girl children.

For third child as a result of twin girls as second birth or if the first birth itself results into three girl children, the third account can be opened.

Age Limitation :

The account can be opened by the natural or legal guardian in the name of a girl child from the birth of the child till she attains the age of ten years. Although any girl child who had attained the age of 10 years, one year prior to commencement of these rules shall also be eligible for opening of account under these rules. Scheme has commenced from 02.12.2014.

Documents required for Sukanya Samriddhi Yojana:

For opening account of girl child, her birth certificate, Address proof and identity proof is required.

Procedure to open Account:

The required documents as mentioned above of girl child whose account is to be opened shall be submitted by the guardian in the post office or bank. You may visit any of the government banks for the purpose of opening the account.

Interest Rate:

Under this scheme, interest rate is not fixed and government will declare on yearly basis the interest on accounts opened under these rules.

For the financial year 2017-18, government had declared interest rate of 8.1%.

Interest will be compounded yearly and will be credited to account till the account gets matured or withdrawn from the date of opening. In case of account holder opting for monthly interest, the same shall be calculated on the balance in the account on completed thousands, in the balance which shall be paid to account holder and the remaining amount in fraction of thousand will continue to earn interest at the prevailing rate.

Minimum and Maximum Deposit :

The account may be opened with an initial deposit of ₹1000 and thereafter any amount in multiple of ₹100 may be deposited subject to the condition that a minimum of ₹1000 shall be deposited in a financial year but the total amount deposited shall not exceed ₹150000 in a financial year.

Money must be deposited for 14 years from the day of opening of the account. After this period, the account will only earn interest as per applicable rates.

Maturity, Withdrawal or Closure:

The account remains operative for 21 years from opening or till marriage of girl child after reaching the age of 18, whichever is earlier.

Once the girl child attains the age of 18, 50% of the money can be withdrawn for girl’s higher studies. The account cannot be withdrawn until age of 18, to prevent any system of early marriage.

However in case of death of girl child or maturity, account can be closed.

Penalty :

If in a financial year, the minimum amount had not been deposited, the account stands inactive. A fine of ₹50 per year has to be deposited to reactivate the account.

Other points to remember :

  • Its account can be transferred anywhere across India, if there is change of city or locality of the girl child.
  • Loan facility is not available against Sukanya Samriddhi Account.

Tax benefits:

  • Deduction under Section 80C of the Income Tax Act, is allowable up to ₹1.5 lakhs along with the other schemes eligible for deduction.
  • The interest earned as well as principal amount received on closure of the account is exempt under Section 10(11A).

So this was all about the Sukanya Samriddhi Yojana. What do you think about this scheme? Must share this with everyone. Let the learning goes on with everyone!

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