Sukanya Samriddhi Yojana

Sukanya Samriddhi Yojana:

Sukanya Samriddhi Yojana is a scheme that can be opened in post offices and approved as a saving account in the name of the baby girl, in private and public banks. Sukanya Samriddhi Yojana- small saving scheme that can be opened in post offices and designated as a saving account in the name of the baby girl, in private and public banks. Just like other post office schemes, the interest rate of Sukanya Samriddhi Yojana is declared quarterly. As with other post office schemes, the interest rate is declared quarterly. Jan-Mar'19 (Q4, FY 2018-19) interest rate was 8.5 percent. It is considered one of the highest-paying investment options in the Fixed Income segment. The following are the historical interest rates for the girl child under this government scheme.

Sukanya Samriddhi Yojana Account: Eligibility

• Only the girl child's parents or legal guardians can open a Sukanya Samriddhi account on the girl's name

• At the time of account opening, the girl child should be less than 10 years. The account will be operational until the girl reaches age 21

• The initial investment can start with Rs. 250 and a maximum of Rs. 1,50,000 per annum with additional deposits in Rs. 100 multiples

• A single girl child can not have multiple accounts with Sukanya Samridhhi

• You can benefit from higher interest rates at fixed-deposit companies 

• Only two accounts of Sukanya Samriddhi Yojana are allowed per family

What is the difference between Child FD and Sukanya Samriddhi Yojana (SSY)?

• Sukanya Samriddhi Scheme is a long-term scheme for investment, whereas a fixed deposit can be used as both a short-term investment scheme and a long-term one. Short tenor FD can help you secure your investment against inflation while long tenor FD can help you build a corpus for future needs

• Any Indian national, whatever their age or gender, can open an FD. Sukanya Samriddhi Account can be opened only for a girl under age 10. Also, an FD can be opened with the child as its nominee or beneficiary in the parent's name

• You can submit Fixed Deposits online. Sukanya Samriddhi Account can't open online mode of operation/account

• An individual may have more than one FD account in their name, but in case of Sukanya Yojana, only 1 account can be opened for a girl child with a cap of two accounts per family 

• Fixed deposits require Rs. 100 of the deposit amount per month to begin with while Sukanya Yojana requires an Rs. 250 minimum

What are the Tax Benefits of Sukanya Samriddhi Yojana?

• When you build a corpus for your daughter's future, Sukanya Samriddhi Yojana will help you accomplish your tax-saving objective. The scheme comes with the status of exempt-exempt-exempt (EEE).

• Your investment in Sukanya Samriddhi Yojana is liable under Section 80C of the Income Tax Act for tax deductions. Deductions up to approximately 1.5 lakhs are permitted. If in a given financial year, you plan to spend some 1.5 lakh in the system, the entire investment will become tax-deductible.

• The interest on your investment is also tax-exempt. 

• You don't have to pay any maturity or withdrawal

Sukanya Samriddhi Yojana: Withdrawal on Maturity

Once your Sukanya Samriddhi account has completed 21 years, you can withdraw the balance along with interest. When the account matures, the total balance and the accrued interest will be paid out to the beneficiary. You won't be required to pay any withdrawal tax. You'll need to submit a withdrawal application form, proof of identity, proof of citizenship, and residence. However, if after 21 years you don't withdraw the balance, the corpus won't earn any interest.

Partial withdrawals:

• For two reasons, you can opt for partial withdrawal of up to 50 percent of your Sukanya Samriddhi account balance: the girl's marriage or higher education

• If you are making the withdrawal for higher education for your child, the account holder must be 18 years old, and she must also have completed the 10th standard. As proof, you will need to submit the letter of acceptance from the educational institution concerned and other relevant documents. Similarly, in the case of marriage, withdrawal is permitted only if she is 18 years old

Premature account closure

• You can only apply for early closure of the Sukanya Samriddhi account under the following conditions:

• If your daughter is 18 yrs old and gets married, you can apply to have your account prematurely closed. You would need to apply with her age proof documents, one-month window period before the marriage, or three months after the wedding. Up to 50 percent of you can withdraw. The balance without any tax implications at the end of the preceding financial year

• In the event of the girl child's death, a provision is made for the premature account closure. A death certificate must be issued, and the entire Sukanya Samriddhi Account corpus will be paid to the guardian together with interest earned up to the month preceding the account closing month. There will be no tax levied upon premature closure

• If the girl child's status changes, i.e., if she becomes a non-resident or a citizen of some other country, then the account can be prematurely closed. As a guardian, the documents reflecting the change in her residency or citizenship status must be submitted within one month

• If the account is five years old and the bank or post office where the account is kept feels it is impossible for the girl child to maintain the account because of various conditions such as the death of the guardian or the child becoming sick, the account could be prematurely closed

How to Open Sukanya Samriddhi Account?

You can open your daughter's Sukanya Samriddhi account by visiting a post office or any authorized branch of the bank which offers this scheme. You'll need to fill in and submit the application form along with the following documents:

• Duly filled in account opening form 

• Birth certificate of the girl child.

• Depositor's ID and address proofs 

• Medical certificates as proof of birth of multiple girl children 

How to use Sukanya Samriddhi Yojana Calculator?

Enter the investment amount by year, your girl's child's age, and start year investment. After you enter the details, the calculator automatically displays the maturity year and the amount you receive upon maturity.

What are the Banks that offer Sukanya Samriddhi Yojana?

Some of the India-based banks have been authorized to open Sukanya Samriddhi Savings Accounts (SSA) by the Indian Government. Some of them are State Bank of India (SBI), Syndicate Bank, UCO Bank, Indian Bank, IDBI Bank, Canara Bank, etc. The below-mentioned banks have been authorized by the Reserve Bank of India to open Sukanya Samriddhi Savings accounts (SSA).

• Axis Bank

• Andhra Bank

• Allahabad Bank

• State Bank of India (SBI)

• Bank of Maharashtra (BOM)

• Bank of India (BOI)

• Bank of Baroda (BOB)

• State Bank of Patiala (SBP)

• State Bank of Mysore (SBM)

• Vijaya Bank

• State Bank of Hyderabad (SBH)

• Indian Overseas Bank (IOB)

• Indian Bank

• IDBI Bank

• ICICI Bank

• United Bank of India

• State Bank of Travancore (SBT)

• Union Bank of India

• UCO Bank

• Punjab National Bank (PNB)

• Syndicate Bank

• State Bank of Bikaner & Jaipur (SBBJ)

• Punjab & Sind Bank (PSB)

• Oriental Bank of Commerce (OBC)

• Dena Bank

• Corporation Bank

• Canara Bank

• Central Bank of India (CBI)