Friday, 14 October 2011

No Maximum limit for Post Office Savings Account

The maximum limit of balance in the Post Office Savings Account has been removed by an order dated 27.09.2011. The Maximum limit of Post office savings account was Rs. 100000 for single account and Rs. 200000 for joint account. But now that limit has been removed and the Post office saving account holders can hold any amount in the account just like other savings account in banks. This has done through an amendment of Post office savings account rules 1981. The major benefits of the amendment rule is follows:-

There will be no limit for retaining balance in post office savings account, from 01st October, 2011 onwards, whether it is a single account or joint savings account.

The depositors can deposit any amount in Post office savings account irrespective of the number of account holders.

Maturity value of any post office savings schemes, irrespective of the amount can be credited in the post office savings account.

Any cheque issued by anybody else can be credited in post office savings account.

As per Section 10(15) of Income Tax Act the interest on post office savings account up to Rs. 3500 for single account holders’ and Rs. 7000 for Joint account holders’ will be exempted from Income Tax with effect from the financial year 2011-12.

The depositor should show the interest income above the above mentioned limit in his or her income tax return and should pay tax accordingly. This is the duty of the depositor.

With all these amendments the Post office savings account also uplifted to the other savings accounts in any banks. The depositor can use the post office savings account also just like other savings account. The interest exemption from income tax is an added advantage from other banks savings account. There is no such tax exemption for interest on savings account in other banks. No doubt the depositors will welcome this new amendment whole heartedly and the benefit of this amendment is more useful in villages where there are no other banking facilities.

Related Posts

Income Tax on Post Office Savings Account

Post Office Small Savings Account

All About Post Office Monthly Income Scheme

No comments :

Post a Comment