National Savings Certificate

National Savings Certificates (NSC) is a safe and low risk investment option that offers guaranteed returns and complete capital protection. Anybody with a low risk appetite, who is looking for a safe investment option while saving on income tax can choose to invest in National Savings Certificates. The government of India has made National Savings Certificates easily accessible for potential investors by making it available by every post office branch across the country.

National Savings Certificates (NSC) Eligibility

Below mentioned is the eligibility criteria to purchase the National Savings Certificates:

• Any Indian citizen can purchase the National Savings Certificates.
• There is no such age limit for individuals to purchase the National Savings Certificates.
• NRIs cannot invest in the National Savings Certificates.
• Investments under the name of minor can also be made under National Savings Certificates

Features Of The National Savings Certificates

Below mentioned are some salient features of the National Savings Certificates:

• Minimum Investments: The minimum amount to purchase the National Savings Certificates is Rs. 100. certificates can be purchased for different denominations such as Rs. 100, 500, 5000 or Rs. 10,000. Initially the investor can make small investments but it can be increased according to the investor.

• Flexibility to Choose Maturity Period: Under the National Savings Certificates, the maturity period is 5 or 10 years. The investor has the flexibility to choose the maturity period for the NSC according to their requirements.

• Nominations: One can add his/her family member including minors as a nominee under the National Savings Certificates. In case of an unforeseen demise of the investor during the tenure of the scheme, the nominee will inherit the proceeds from this scheme.

• Loan Against the Certificates: The National Savings Certificates can be used as a collateral and can be provided to the banks to get loans so that the investor is able to fulfill his/her immediate financial obligations. However, to do so the post master must authorize the transfer.

• Transfer of Certificates: Transfer of certificate from one person to another and from one post office to another is allowed under National Savings Certificates.

Tax Benefits Of National Savings Certificates

The National Savings Certificates are a type of tax saving investment tool. One can avail income tax benefits by investing in NSC. Investments of upto Rs. 1.5 lakh made towards NSC qualify for tax deductions under Section 80C of Income Tax Act, 1961. Additionally, the accrued interest on the investments are also added back to the initial investment amount and also qualify for tax exemptions.