If you are one of those investors who want to take advantage of all three security, attractive returns and tax savings on their investment, then the National Savings Certificate (NSC) (VIII version) presented by the Indian Postal Department is a great option for you. This is a government -backed scheme that gives investors an opportunity to increase capital for a certain interest rate and long periods, which keeps their capital completely safe.
The main features of NSC: safe and beneficial
The National Savings Certificate (NSC) is a 5 -year savings scheme. Its interest rate is fixed from time to time by the government, which is currently 7.7% and is available on the basis of compounding annual. Although interest is paid only on maturity, investors get the benefit of tax exemption on the amount invested under Section 80C of the Income Tax Act, which saves their tax. The biggest feature of this scheme is that it is fully supported by the government, due to which investors have no concern about the safety of their money.
There is no maximum limit limit in this scheme. You can start with a minimum of ₹ 1,000 and after that you can invest any amount of amount in a multiple of ₹ 10. Apart from this, loan facility is also available on NSC, so that investors can get financial assistance if needed on their investment amount. The scheme offers investors a unique combination of investment security, attractive returns and tax benefits at the same time.
Investment and Return: ₹ 5.79 lakh funds for ₹ 4 lakh
It is very easy to calculate the returns on investment in the NSC scheme as it is based on a certain interest rate. Suppose, if an investor invests ₹ 4,00,000 in this scheme, then he will get an interest of ₹ 1,79,613.52 after a 5 -year maturity period, according to an annual compound interest rate of 7.7%. Thus, after 5 years, the investor will have a total fund of ₹ 5,79,613.52.
This guaranteed return is a major incentive for investors who want to avoid market fluctuations. The investment process in NSC is also very simple. Any person can open an account by going to his nearest post office or apply online. The KYC process has also become simple, which helps investors to open an account in a short time.
Benefits of tax savings and regeneration
Tax saving on investment is another important benefit of NSC. As mentioned above, under Section 80C of the Income Tax Act, investors can claim income tax exemption on investment of up to ₹ 1.5 lakh. This makes it a favorite option for those who not only want to increase their capital, but also reduce their tax burden.
In addition, the interest earned in NSC also has tax benefits. Each year interest earned is considered as investment and it is also considered eligible for tax exemption under Section 80C. However, the final year interest is taxed. At the maturity of investment, investors can also renegberry their amount, making them achieve their financial goals even faster. Overall, NSC is a scheme that not only protects investors’ money, but also helps them to create a solid financial future.
