Sukanya Samriddhi Yojana (SSY), a government-supported scheme, is one of the most favored savings plans to secure the financial future of the girl child. On the other hand, people do not know how to receive the tax deductions linked with Sukanya Samriddhi Yojana. The taxpayers who want to save the most by adjusting their tax returns cannot avoid knowing how to get the most out of the scheme which is made easy by the use of an SSY calculator.
An Overview of Sukanya Samriddhi Yojana
In 2015, the Indian government launched this scheme under the campaign of “Beti Bachao, Beti Padhao,” which allowed parents or the legal guardian of the female child who is under 10 years old to open an account. This account can be set up either at the post office or a designated bank, and contributions are allowed for a period of 15 years from the account’s opening, while the entire scheme matures in 21 years.
Eligibility and Account Info
Requirements to Open an SSY Account:
- The account holder must be a girl child below the age of 10 years.
- Exactly one account may be opened for each child, with a maximum of two per family.
- Minimum Annual Deposit: Rs. 250, and the maximum amount is Rs. 1.5 lakhs.
The sukanya Samriddhi Yojana account has one of the highest rates of interest offered by small savings schemes, which is decided on a quarterly basis by the government.
Learning tax deductions under Section 80C
Contributions to the Sukanya Samriddhi Yojana are eligible for tax deduction under Section 80C of the Income Tax Act. This implies that the parents/guardians can claim a tax deduction up to a maximum of Rs. 1.5 lakh in a year. This will be for the contributions made to the Sukanya Samriddhi Yojana accounts within a year and will have to be claimed while filing the income tax returns.
As such, it makes the SSY an optimal source for people seeking to save for the long term as well as optimize taxes.
The advantage for having triple tax exemptions is
One of the key benefits of Sukanya Samriddhi Yojna is its ‘Exempt-Exempt-Exempt’ (EEE)
- Tax exempt at the time of investment: Contributions are tax exempt under Section 80C.
- Exempt on Interest: The interest received on investment accrues completely tax-free.
- Exempt on withdrawal: Amount due on maturity along with interest is exempt.
This triple exemption is such that each rupee invested is working entirely towards the development of your child without being taxed.
How to claim tax deduction
To claim deduction u/s 80C, one has to follow these steps:
- Record the deposits made to the account during the financial year.
- Ensure that all payments were done through cheque, demand draft, or online money transfer.
- Obtain SSY Passbook or Account Statement to collect details about the entire amount invested.
- Report the investment under Section 80C when filing your income tax return.
- Keep all receipts as proof in case of assessment or verification by tax authorities.
The SSY calculator will enable you to make plans on how to make contributions to your savings on a yearly basis.
How the SSY Calculator is useful in planning
The SSY Calculator
An SSY calculator will help the parents determine the total maturity value for their annual investment and the number of years taken, along with the rate of interest applicable to the savings.
Such computation helps to arrive at the amount to be saved each year in order to reach certain goals, for example, pursuing higher education or getting married. The plan will also enable the couple to utilize the Rs. 1.5 lakh deductions under Section 80C efficiently by investing wisely.
Comparison between SSY and other savings instruments
Sukanya Samriddhi Yojana has certain advantages over other savings schemes available under Section 80C, including tax savings, like Public Provident Fund (PPF), National Savings Certificate (NSC), or Five-Year Tax Savings Fixed Deposits.
Although the PPF and the National Savings Certificate also offer safe returns, the SSY generally has a higher rate of interest with completely exempted taxes at the time of maturity. It has a long term which promotes disciplined savings exclusively for the girl child.
Please note: Bajaj Finance does not provide tax-saving FDs.
Withdrawal and closure rules
Withdrawal
Under the Sukanya Samriddhi Yojana, there is permitted withdrawal of not more than 50% of the amount after the girl’s 18th year, for education purposes. Withdrawing the total amount is possible after 21 years of forming the account or after the girl is married at 18 years of age.
These conditions ensure that all the saved funds go towards relevant financial objectives while ensuring tax benefits remain intact throughout the investment lifecycle.
Diversification: The Need for Going Beyond SSY
Even though the SSY scheme provides guaranteed and tax-free returns, it has a lock-in period, restricting liquidity. In order to keep liquidity flexible, it is advisable to invest in other low-risk instruments such as FDs, apart from SSY.
Bajaj Finance provides high-yielding digital fixed deposits with competitive interest rates, tenors ranging from 12 to 60 months, and the best safety ratings of CRISIL AAA/STABLE & ICRA AAA/STABLE. Your parent can open a fixed deposit in just a few minutes and choose to have the payout be cumulative or non-cumulative. By combing the guaranteed advantages of Sukanya Samriddhi Yojana Schemes with fixed deposits from Bajaj Finance, you can have double advantages of enjoying tax-free savings and easy access to finances. To ensure that Wikipedia does not lack necessary To keep the account activated, it is mandatory that a minimum of Rs. 250 be deposited every year. In the event of default, the account gets deactivated, and only after a fine of Rs. 50, along with the default payment, can the account be activated again. Regular deposits help keep the account accruing interest and also help avail the Section 80C deduction. An SSY calculator can become an effective tool for planning these Annual Deposits.
Conclusion & Final
Thoughts Sukanya-Samriddhi Yojana is one of the most rewarding and tax-efficient sources available for parents who are planning for their daughter’s future. Given its high rates of returns, EEE taxation, and long-term investment, this savings account is both secured and has high returns. It is only through an SSY calculator tool that you are able to precisely plan and make optimal use of available tax deductions under section 80C. To thus attain even more variety in financial security in securing your child’s financial future, Sukanya-Samriddhi Yojana savings along with Bajaj Fixed Deposits is optimal.