The NSC Calculator allows an individual to calculate their returns on an investment utilizing the National Savings Certificate scheme.
Types of National Savings Certificates:
A National Savings Certificates is a fixed investment that is available for a time period of 5 years and 10 years. There are three types of NSC certificates that are available for both schemes:
- Single Holder Certificate: This is a scheme that can be taken up by an individual either in the name of a minor or in their own name.
- Joint A Certificate: This is a scheme that can be applied for by two adults who are both joint holders of the certificate. The withdrawal amount that is due will then be paid to both individuals at the time maturity.
- Joint B Certificate: This scheme is made available to adults who want to apply for a NSC scheme. In this scheme, two adults become the joint holders of the certificate and the withdrawal amount will then be paid to either party.
Features and benefits of National Savings Certificate: There are a number of features and benefits that a National Savings Certificate can offer. Here are some of the features listed below:
- Interest rates for NSC VIII Issue, which is available for a period of 5 years, is 8.5% p.a.
- Interest rates for NSC IX Issue, which is available for a period of 10 years, is 8.8% p.a.
- There is no maximum cap that is levied on your investment which comes under NSC VIII Issue (5 years).
- Any investment that goes above Rs.1.5 lakhs will qualify for Income Tax Rebate under Section 80C of IT Act.
- HUF and Trust will not be allowed to invest.
- An adult can purchase a single holder type certificate on behalf of a minor or in the name of an adult.
- An interest that is acquired annually but is reinvested will qualify for Tax deductions under Section 80C of IT Act.
- There is no tax deduction at the source.
Some of the benefits of a National Savings Certificate are listed below:
- National Savings Certificates are very easy to access and can be accessed through your local post office.
- National Savings Certificates are very dependable and reliable.
- They are simple savings schemes that can be set up and understood easily.
- Interest rates do not change for an NSC that you have purchased. You know exactly what you’re getting at the time of maturity.
- National Savings Certificates qualify for tax deductions.
- You can purchase any number of National Savings Certificates.
National Savings Certificate is an excellent investment option but there are a few restrictions that come along with the scheme:
- There is a minimum investment threshold of Rs.100
- NSCs are issued at a minimum cap of Rs.100 even though an individual can purchase a NSC in Rs.500, Rs.1,000, Rs.5,000, and Rs.10,000 denominations
Steps to follow when purchasing a National Savings Certificate:
You can purchase a National Savings Certificate by following the steps mentioned below:
- Go to the nearest post office and ask for a NSC form. This is special application form that is designed specifically for a National Savings Certificate. You can also get a copy of this form by downloading the form online.
- Make up your mind on how much do you intend on investing. Keep in mind that NSC helps in reducing the amount of tax that you have to pay so you might just be able to invest more that you initially imagined. You can use a tax calculator to see how much you are able to invest.
- The form is very straightforward and you will have to complete and submit the completed application form to the post office.
- Provide documents needed for identity proof such as driving licence, voter’s ID, Aadhar Card, etc.
- Make the necessary payments by any of the following methods:
- Cash
- Cheque
- Demand Draft
- Pay order
- By transferring funds from your Savings Account at the post office
- If you already own a National Savings Certificate, you can surrender the matured certificate and you can then reinvest the same back into the new account
- Once you have submitted all required documents, the Postmaster will then check your application, ID proof, and payment method used to check for any irregularities. Once this is done, the Postmaster will then issue a National Savings Certificate. If the Postmaster does not have a National Savings Certificate with him/her, you will receive your NSC through the post which would arrive at your registered address in a couple of business days.