‘Beti Bachao, Beti Padhao’ is an excellent campaign with a cause. It was initiated by the Government of India, headed by PM Narendra Modi. In January 2015, a small savings scheme called ‘Sukanya Samriddhi Yojana’ (SSY) was launched.
What is Sukanya Samriddhi Yojana (SSY)?
Sukanya Samriddhi Yojana is a small savings scheme which aims to create awareness on the importance of the girl child and seeks her welfare. SSY encourages parents of a girl child to secure her future by making sure she enjoys a good education. SSY is an exceptional initiative towards providing financial security and independence to women in our nation.
Who can open a Sukanya Samriddhi Account?
An SSY account has to be opened in the name of a girl child only. It should be opened by the parent or the legal guardians of a girl child. The account can be opened anywhere in India, through post offices or authorized commercial banks in India. If the need arises, the account can be transferred to any bank in India.
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Sukanya Samriddhi Yojana – Eligibility, Tax Benefits and Rules
Salient features of SSY:
- SSY is one of the most beneficial tax-saving schemes.
- The SSY account matures after 21 years from the date of account opening, or when the girl child gets married (whichever is earlier).
- The girl must get married only after 18.
- If the account is not liquidated on maturity, it will still earn interest until it is closed.
- Even though SSY account matures 21 years after its opening, deposits are permitted only for 14 years from the date of opening the account.
- A girl child can start operating her account once she turns 10.
Conditions to open a Sukanya Samriddhi Yojana account:
- An SSY account can be opened only for a girl child.
- The account has to be opened any time before a girl child turns 10 years.
- Only one account per girl child can be opened.
- A maximum of two SSY accounts by parents or legal guardians; one for each daughter.
- An age proof, like the birth certificate of the girl child, is a must.
- In case the first or second delivery is of twin girls, the SSY scheme allows parents to open a third account if they have another daughter.
- The SSY account matures after 21 years, from the date of account opening, or when the girl child gets married (whichever is earlier). The girl must get married only at 18.
- An NRI girl child cannot have a Sukanya Samriddhi Yojana (SSY) account.
- If an SSY account has to be transferred, it can be done free of cost and you have to show proof of shifting of residence. Else, a fee of Rs 100 has to be made to the post office or the bank, to which the transfer is made.
Rate of interest on Sukanya Samriddhi Yojana Account:
- The rate of interest applicable to this scheme is one of the highest among Government sponsored saving schemes. Initially, interest on SSY was 9.1% a year. As of now, it is 8.1% per year.
Withdrawal on the maturity of the SSY account:
- On maturity, the amount withdrawn is directly paid to the account holder, i.e. the girl child, in whose name the account is held.
- The proceeds on the maturity of a Sukanya Samriddhi Yojana account can be utilized for the girl child’s education.
Pre-mature withdrawal of SSY account:
- Pre-mature withdrawal is allowed only to fund the girl child’s higher education.
- Withdrawal is limited to 50% of the funds.
- The girl child has to be 18 years or above.
How to open a Sukanya Samriddhi Account?
- An SSY account has to be opened in the name of a girl child only.
- It should be opened by the parent or the legal guardians of a girl child.
- An SSY account can be opened anywhere in India, through post offices or authorized commercial banks in India.
- You need a minimum of Rs 1,000 to open an SSY account.
- A minimum of Rs 1,000 can be deposited in an SSY account each financial year.
- A maximum of Rs 1.5 Lakhs can be deposited in a financial year.
- Deposits should be made in multiples of Rs 100.
- Deposits can be made in lump-sum or installments.
- There is no restriction on the number of deposits to be made in a month or a financial year. Just make sure you don’t forget to make the minimum investment.
- If you fail to deposit the minimum amount in any year, the SSY account will be discontinued.
- The account can be regularized on payment of a penalty of Rs 50 a year, along with the minimum payment of Rs 1,000.
Documents required to open a Sukanya Samriddhi Scheme:
- Birth Certificate of the girl child having her name on it.
- Identity Proof of the parent or legal guardian who wants to open the account.
- Address Proof of the parent or legal guardian who wants to open the account.
SEE ALSO: Income Tax E-filing For Gifts Received During The Year 2018
An alternative to birth certificate:
In the absence of the birth certificate or the name of the girl child on the birth certificate or any other discrepancies in the birth certificate of the girl child, you can submit:
- Certificate of date of birth from the School Headmaster, OR
- Certificate of date of birth from the Hospital where the girl child was born
- Birth certificate is of utmost importance, so make sure it contains the name of the girl child accurately as it is this document that will make her eligible to withdraw money on maturity.
Tax benefits of Sukanya Samriddhi Yojana:
It comes with the exempt-exempt-exempt (EEE) status. The amount deposited up to Rs 1.5 Lakhs a month, enjoys Section 80C deductions under the Income Tax Act. Interest is tax-free.
List of authorized banks for Sukanya Samriddhi Scheme:
There are a total of 28 public and private banks where you can open the Sukanya Samriddhi Bank Account:
- Allahabad Bank
- Andhra Bank
- Axis Bank Limited
- Bank of Baroda
- Bank of India
- Bank of Maharashtra
- Canara Bank
- Central Bank of India
- Corporation Bank
- Dena Bank Limited
- ICICI Bank Limited
- IDBI Bank Limited
- Indian Bank
- Indian Overseas Bank
- Oriental Bank of Commerce
- Punjab & Sind Bank
- Punjab National Bank
- State Bank of Bikaner and Jaipur
- State Bank of India
- State Bank of Hyderabad
- State Bank of Mysore
- State Bank of Patiala
- State Bank of Travancore
- Syndicate Bank
- UCO Bank
- Union Bank of India
- United Bank of India
- Vijaya Bank
Apart from the above, Indian Post offices also allow you to open SSY accounts under the scheme.
How to use Sukanya Samriddhi calculator?
You will be asked to provide the age of your girl child and the amount that you want to invest in the scheme. Be sure to invest a minimum of Rs 1,000 and maximum of Rs 1.5 Lakhs in a financial year. Deposits must be made in multiples of Rs 100.
How does the calculator work?
Based on the details entered by you, the calculator calculates the approximate amount that you receive on maturity of the account. Though you make deposits only for 14 years, the scheme matures after the completion of 21 years from the date of opening of the account. However, you earn interest on the earlier deposits made.
What does the calculator show?
Based on the information provided by you, the calculator shows the year of maturity, the maturity value and the interest earned.
It’s assumed that your SSY account earns an interest rate of 9.2% per year for 21 years.
Calculating Maturity Value after 21 Years:
Loan against Sukanya Samriddhi Yojana:
Unlike other deposits or FDs, no loan can be availed against Sukanya Samriddhi Yojana Account.
Be Wise, Get Rich.