Sukanya Samriddhi Yojana – All You Need to Know

Looking for ways to save for your girl child's future? There is no better time than now. What if we told you there is a scheme that allows you to make small deposits every year for the education and marriage expenses of your daughter AND pays a handsome rate of interest replete with tax benefits?

What is Sukanya Samriddhi Yojana?

Sukanya Samriddhi Yojana was launched as part of the Beti Bachao Beti Padhao Campaign on January 22, 2015 by Prime Minister Narendra Modi. The objective was to encourage families to invest in the education of girl children and save for their marriage expenses. Keeping these objectives in mind, the small deposit scheme offers an attractive 8.1% rate of interest along with tax benefits. Here’s everything you need to know about this deposit scheme!

What are the eligibility criteria to deposit money in SSY Account?

  • Must be the parent of a girl child. The account can be opened any time after the birth of the girl child until she turns 10.
  • Should be resident citizen of India
  • Most number of accounts that can be opened is one each for two girl children in a single family. (Three accounts can be opened only if the first born or the second born are twin girls)
  • Deposit can be made by legal guardians or parents of the girl child until she is 18 years old.
  • After the girl child turns 18, she alone can operate the account.

What are the Sukanya Yojana Account details and rules?

  • SSY Deposit Cccount can be opened with a minimum deposit of Rs.250, which was Rs.1000 before 5th July 2018. Maximum deposit amount can be up to Rs.1,50,000.
  • The deposit matures 21 years from the date of account opening or until the marriage of the girl after she attains the legal marriageable age of 18 years.
  • After the girl child turns 18 years of age, 50% of the balance can be withdrawn to meet educational expenses. Proof of admission must be provided.
  • You can open the Account in a post office or authorized commercial bank branches.
  • The depositor must make a deposit of sum between Rs.250 and Rs.1,50,000 every year until 15 years from the date of Account opening. You need not make any deposits after 15 years until the deposit matures.
  • The rate of interest offered on Accounts opened between October 1, 2018 and 31 December, 2018 is 8.5%.
  • If the deposit is not made every year as mentioned above, the account will fall under ‘Account under default’. The account can be reactivated by paying a fine of Rs.50 per year that you defaulted on making a deposit. The reactivation can happen until 15 years from account opening.
  • When the Account matures on completion of 21 years, the interest accrued along with the balance will be paid to the child once he/she provides the following:
  • SSA withdrawal application
  • proof of identity
  • proof of residence and citizenship
  • proof of age.
  • Balance can be transferred anywhere within India from one post office branch or bank branch to another, after the concerned parent, guardian or the girl child provides a proof of change of residence.
  • Premature closure of the account is allowed on the basis of:

Intent of marriage (should be notified a month before marriage of up to 3 months after the marriage)

Deemed closure due to change of status such as change of citizenship and country of residence.

After 5 years of maintenance of the deposit account if the bank or post office find that maintenance of the account is causing a financial burden on the girl child for medical reasons or death of a parent or guardian, premature withdrawal will be allowed.

The Sukanya Samriddhi Yojana Account can be closed prematurely, for any other reason, but the deposit will earn the rate of interest applicable on post office savings bank accounts.

What are the documents needed to open an Sukanya Samriddhi Yojana Account?

To open an SSY account, you will need to provide the following:

  • Filled Sukanya Samriddhi Registration Form
  • Birth certificate of the girl child
  • ID proof of the depositor
  • Residential proof of the depositor.

What are the tax benefits of opening an SSY account?

A big draw of this deposit scheme is that it comes with multiple tax benefits.

  • Deposits up to Rs.1,50,000 is eligible for a deduction under Section 80C of Income Tax Act.
  • The interest earned and the proceeds from maturity of the deposit is tax free. The interest is compounded annually.

Nothing says protecting the future of your loved one, than by a Sukanya Samriddhi Yojana Account. Looking to open an account? Contactyour closest HDFC Bank Branch now!