5 things to know about the Sukanya Samriddhi Scheme

The Government of India introduced the Sukanya Samriddhi Scheme in the year 2015 to provide an impetus to its Beti Bachao, Beti Padhao scheme. This scheme is a small savings scheme that is meant to build a corpus for the girl child. This scheme allows the parents or the legal guardian to open a Sukanya Samriddhi Account for the girl child. An account can be opened under this scheme for both an adopted girl child and a girl child who is born. The account can be opened both online and offline in a post office or in designated banks. To open a Sukanya Samriddhi Account, you need to fill up the account opening form and submit the minimum contribution and the account will be processed.

Opening this account is extremely easy. It can be opened with both the post office and a few notified banks. But before you open a Sukanya Samriddhi Account, here are a few things you need to know about it.

Here are 5 things to know about the Sukanya Samriddhi Scheme:

1. Tax benefits:

There are three tax benefits associated with the SSY. Any contribution or investment made in the Sukanya Samriddhi Account gets a deduction under Section 80C of the Income Tax Act up to Rs. 1,50,000. The contribution can be any amount up to the maximum allowable amount. The corpus invested in the Sukanya Samriddhi Scheme earns interest on it. This interest is also tax free which increases the earnings of the account holder. The amount withdrawn on maturity of the Sukanya Samriddhi Yojana is also tax free. This provides a greater chunk of earnings to the girl child and can help her get financial independence.

2. Minimum and maximum contribution:

The minimum contribution under the scheme is Rs. 1,000 and the maximum contribution under the scheme is Rs. 1,50,000. The contributions can be made in installments throughout the year.

3. Contribution period and maturity:

The deposits in the Sukanya Samriddhi Account can be made for 14 years from the time of opening the account. However, the account matures within 21 years from the time the account is opened. However, the account can be opened from the time of the girl child’s birth till she is 10 years of age.

4. Interest:

The corpus in the Sukanya Samriddhi Yojana earns interest at the highest rate among all small savings schemes. The interest is calculated monthly on the balance in the Sukanya Samriddhi Account but it is credited to the account yearly.

5. Withdrawal:

The Sukanya Samriddhi Account cannot be attached by the Court or the Income Tax department to recover dues from the parent or legal guardian. Any withdrawals in the scheme are not permitted before maturity of the scheme. However, one premature withdrawal is permitted when the girl child reaches majority or 18 years of age. This withdrawal is allowed either for higher education of the girl child or for wedding expenses. Any other withdrawal is not allowed.