National Savings Certificate (NSC)
National Savings Certificate, also popularly known as NSC is a tax saving investment instrument with a maturity of 6 years.
Features and Details –
- Minimum investment Rs. 500/- No maximum limit.
- Rate of interest 8% compounded half yearly.
- Rs. 1000/- grow to Rs. 1601/- in six years.
- Two adults, Individuals, and minor through guardian can purchase.
- Companies, Trusts, Societies and any other Institutions not eligible to purchase.
- Non-resident Indian/HUF can not purchase.
- No pre-mature encashment.
- Annual interest earned is deemed to be reinvested and qualifies for tax rebate for first 5 years under section 80 C of Income Tax Act.
- Maturity proceeds not drawn are eligible to Post Office Savings account interest for a maximum period of two years.
- Facility of reinvestment on maturity.
- Certificate can be pledged as security against a loan to banks/ Govt. Institutions.
- Facility of encashment of certificates through banks.
- Certificates are encashable any Post office in India before maturity by way of transfer to desired post office.
- Certificates are transferable from one Post office to any Post office.
- Certificates are transferable from one person to another person before maturity.
- Duplicate Certificate can be issued for lost, stolen, destroyed, mutilated or defaced certificate.
- Nomination facility available.
- Facility of purchase/payment to the holder of Power of attorney.
- Tax Saving instrument – Rebate admissible under section 80 C of Income Tax Act.
- Interest income is taxable but no TDS
- Deposits are exempt from Wealth tax.
thanks for the nsc news. but it is old story sir.,
presently effective july 2011 it was announced in all newspapers the period of maturity is 5 years. but at the time of maturity the tds will be done OR NOT is the question. next interest earned more than 3500 is taxable on small savings schemes in post offices then better to invest in banks not in post office > FOR Small investors since he is not cancelling the dep for 6 years nsc but now taxable at the end of maturity please clarity whether the law implemented.
can u please inform since when is HUF not applicable to buy the NSC? is there any such circular ? kindly mail me the link if you know it. I have bought the nsc on HUF , and Now there is a problem as its maturity is due.
Hi Nisarg,
w.e.f. 13 May 2005, any Juristic person (such as HUF / Trust) are not allowed to have PPF / NSC. If they do so, then the refund on maturity will be given withot interest.
But yes, the same is not applicable to PPF / NSC taken before 13 May 2005.
There is a Circular from RBI in this regard. You can go to website of RBI and locate the Circular in May 2005. The Circular No. is CO.DT/15.02.001/H-9844-9866/2004-05
ARUN JI
AS IAM REGULAR TAKING OF NSC HUF FOR THE LAST 5 YEARS FOR THE BENEFIT OF IT AND ALSO SHOWING IN MY IT-ASSESSMENT EVERY YEAR WITH INTREST WHAT I AM GETTING FORM NSC HUF AND AT LAST WHEN MY NSC MATURITY DATE CAME THEY REFUSED TO GIVE MY TOTAL AMOUNT WHAT TO DO IN THIS MATTER PLEASE REPLY
Shall we obtain the NSC as the name of Company
Dear sir, It would be grateful if you could advice me on the obtaining the maturity amount on the 3 NSC that got expired in 2008.
what is the procedure & % for take a loan on Nsc
from SBI, denabank, bank of baroda
Sir
plz advicecif anything can be done as I have purchased nsc and now on maturity I m not getting the matured amount.
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Sir,
I want to purchase NSC of Rs. 10000 or 20000. I have an account in SBI and net banking . can i purchas eit online? from my SBI saving account…..? guide me accordingly pls…