‘Save girls, educate the girl child,’ a message by the Beti Bachao Beti Padhao (BBBP) campaign, works on the empowerment of the girl child. The government has been focusing on the welfare of the girl child in recent years. In line with these efforts, it also launched the Sukanya Samriddhi Yojana in 2015.
The Sukanya Samriddhi Yojana scheme currently offers an 8% per annum interest rate.
What is Sukanya Samriddhi Yojana?
Sukanya Samriddhi Yojana is a scheme backed by the government and launched by our honorable prime minister that focuses on the economic welfare of the girl child. It is jointly run by the Ministry of Women and Child Development, the Ministry of Health and Family Welfare, and the Ministry of Human Resource Development. This scheme aims to tackle two serious issues related to the girl child in India- one is Education, and the other is Marriage. Under this scheme, the parent or guardian can open an account (Sukanya Samriddhi Account) for their girl child of ten years or younger.
Sukanya Samriddhi Yojana helps parents save for their little girl from the time they are born. In Sukanya Samriddhi Yojana, the minimum deposit amount is 250/- (which was Rs.1000 before 5 July 2018), and the maximum deposit ₹ 1.5 Lakh in a financial year.
These small deposits help create an adequate amount for the little girl's bright future. The account can be opened at any post office or authorized commercial bank. The investment tenure under Sukanya Samriddhi Yojana is 21 years, starting from the opening date.
However, you only need to make contributions to this account for 15 years. After this, it will continue to earn interest even if no contribution is made to the account.
What are the Features of the Sukanya Samriddhi Yojana Account?
Salient Features of Sukanya Samriddhi Yojana | |
Interest Rate | 8% (Q1 FY 2023-24) |
Eligibility criteria | The SSY account is opened after the birth of the girl child but before she turns 10 years of age. |
Minimum and Maximum Investment | Rs. 250-Minimum and Rs. 1.5 lakh-Maximum (per annum) |
Salient Features of Sukanya Samriddhi Yojana | |
Maturity Period | The lock-in duration of the SSY account of 21 years from the date of opening |
Sukanya Samriddhi Yojana serves two purposes - Welfare of the girl child and a tax-saving investment. Let us discuss the Sukanya Samriddhi Yojana as a tax-saving instrument.
Sukanya Samriddhi Yojana Eligibility
Only parents or legal guardians of a girl child can open an SSY account
The girl child has to be below the age of 10 at the time of account opening
Only one account can be opened in the name of a girl child
Only two SSY accounts are allowed for a family, i.e., one for each girl child
Note: Sukanya Samriddhi Account can be opened for more than two girls in some special cases, which are-
If a girl child is born before the birth of twin or triplet girls or if triplets are born at first, then a third account can be opened.
If a girl child is born after the birth of twin or triplet girls, a third SSY account cannot be opened.
Benefits of Sukanya Samriddhi Yojana Account
Investing in the Sukanya Samriddhi Yojana offers several advantages:
Guaranteed Returns: This government-backed scheme ensures a guaranteed investment return. Presently, it provides an annual return of 8% p.a., surpassing other government schemes.
Tax Benefits: Contributions made to the Sukanya Yojana qualify for tax deductions. You can avail a deduction of up to Rs 1.5 lakh under section 80C. Additionally, interest earned and maturity amount are tax-exempt.
Ideal for Girl Child: If you have a daughter, this scheme is a viable option as it guarantees returns on your investment. The maturity amount can be utilized for your daughter's education or marriage expenses.
Economic Investment: You can initiate a Sukanya Samridhi account with a minimum deposit of Rs 250. Further, maintaining an active account requires a minimum annual deposit of Rs 250. This affordability makes it a practical investment choice.
What are the Tax Benefits of Sukanya Samriddhi Yojana?
Sukanya Samriddhi Yojana is a reliable investment choice that offers huge tax benefits. This scheme comes under the EEE format, i.e., Exempt-Exempt-Exempt. Tax benefits ensure that investing in the SSY scheme doesn’t burden a family's wallet. Following tax benefits are provided to those enrolled in the SSY scheme:-
Sukanya Samriddhi Yojana qualifies for exemptions up to Rs. 1.5 lakh under Section 80C of the Income Tax Act. Also, 80C deductions are not applicable if you choose the new regime.
The interest accrued on the maturity of the deposit is tax-free. The interest is compounded annually.
The lock-in period for the SSY scheme is 21 years starting from the opening date, and after the maturity, the amount invested can be withdrawn, which is tax-free.
When a girl child becomes 18 years of age, you can withdraw the principal and interest amount at the time of maturity, and this amount is tax-exempt.
In addition to the various other benefits of Sukanya Samriddhi Yojana including the welfare of girl child, it is also one of the most popular tax-saving options.
What are the Eligibility Criteria for Tax Deduction?
SSY account can be opened only in the name of a girl child before she reaches the age of 10 years. Then, the parents or guardians of the girl child can start a Sukanya Samriddhi Yojana Account on behalf of their girl. Only one depositor can claim the tax deductions towards this scheme under Section 80C of the Income Tax Act.
How to Open Sukanya Samriddhi Yojana Account Online?
Opening a Sukanya Samriddhi Yojana account online is very easy. First, check if the bank where you already have your savings account is a participating bank in the SSY scheme. You can visit the bank’s website and download the SSY account opening application form. Now, fill out the form and submit it to the participating bank to open the SSY account.
What are the Documents Required for opening Sukanya Samriddhi Yojana Account?
Birth certificate of the girl child.
Identity and Address Proof of the guardian.
Medical certificate to prove the birth of a single or multiple girl child.
Other KYC documents like Voter ID, Aadhaar card, etc.
Other documents as required by the post office or banks.
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