Post office
You can also take tax exemption on investment in the new tax system. You can get this discount through Post Office Savings Account (POSA). This facility is not in the saving account of banks. Let us tell you that the post office provides better interest rates than most banks, which is attraction for customers seeking more returns on these tax benefits as well as their savings. Let us know how you can earn more with income tax exemption by opening a post office savings account (POSA).
Can take up to 10 thousand discounts
The Post Office Savings Account (SB) works like a general bank savings account, with the minimum deposit amount of Rs 500 and the minimum withdrawal amount is Rs 50. There is no maximum limit of investment in it and investors can enjoy tax exemption up to Rs 10,000. This account also provides an interest rate of 4% for the period of April-June 2025.
Under the Income Tax Act, 1961, POSA provides tax exemption on interest income under Section 10 (15) (i), which is applicable under the new tax system. The rebate allows a single account holder to claim a tax exemption of up to Rs 3,500 and a joint account holder up to Rs 7,000, which is additional on the general tax deduction available for savings accounts.
Tax deduction under Section 80TTA
Tax deduction under Section 80TTA allows general taxpayers to claim up to Rs 10,000 on interest income from savings accounts. It is applicable to accounts of banks, cooperatives and post offices. For senior citizens, a high cut of up to Rs 50,000 is available under Section 80TTB. These deductions cover the interest earned from savings accounts, fixed deposits and recurring deposits, providing significant relief to senior citizens compared to other taxpayers. However, these cuts are not applicable under the new tax system.
More interest from banks
If you look at the interest rates paid by the post office savings accounts, it is generally higher than the rates given by banks, which leads to a better option for investors who see better returns. The current economic environment is particularly important, where savings seek safe and beneficial options. The strategic position of Posa, with their competitive rates and tax benefits, makes them a better option for many individuals.
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