National Savings Certificates (NSC)

National Savings Certificate

Looking for a reliable government savings scheme with guaranteed returns and tax benefits? National Savings Certificate (NSC) is the perfect option for you. Established in the 1950s to support nation-building, NSCs can be easily purchased from post offices or select banks.

National Savings Certificate (five years) offers a current interest rate of 7%, compounded annually. This makes NSC a great option for those seeking guaranteed interest and complete capital protection. However, it may not provide returns that beat inflation, unlike tax-saving mutual funds or national pension systems.

Investing in National Savings Certificate (NSC) is straightforward and hassle-free. You can buy NSCs in electronic or passbook mode from any public sector bank or the top three private banks – ICICI, HDFC, and Axis. If you hold a savings account with a bank or post office, you can conveniently buy NSCs online using internet banking. Additionally, NSCs can be bought on behalf of a minor or as a joint account with another adult.

Income Tax benefits Section 80C of the

The tax benefits of National Savings Certificate (NSCs) are substantial. Although there’s no limit on the purchase of NSCs, investments of up to Rs 1.5 lakh annually can avail tax benefits under Section 80C of the Income Tax Act, 1961. The interest earned on NSCs for the first four years is also deemed to be reinvested and eligible for a tax break, subject to the annual limit of Rs 1.5 lakh. However, the interest earned in the fifth year is taxable based on the investor’s applicable slab rate.

Investing in National Savings Certificate (NSC) is a smart way to receive guaranteed returns and tax benefits. Start investing in NSCs today to enjoy these benefits!