Home Tips Investments Post Office Monthly Income Scheme (MIS)
Post Office Monthly Income Scheme (MIS)
If you are looking for a decent capital gain with a secured investment option then Post of Monthly Income Scheme (POMIS) may end your search. Generally, we end up parking our funds in fixed deposits and in other debt investments plans but POMIS promises better benefits as compared to others. Lets have a look at what POMIS is, how it functions and what all it offers.
Post Office Monthly Income Scheme plan is one of the many investment options offered by Post Office in India. Apart from delivering mails, post office offers a bouquet of services that include sale of forms, bill collection, savings schemes, life insurance cover etc.
Schemes offered by Post Offices are risk free as there is no touch of equity in them. POMIS is also one such scheme. Let us have a look at the features and benefits of POMIS.
Benefits & Features of Post Office Monthly Income Scheme Account
- Minimum investment amount is Rs.1500/- or in multiple thereafter.
- A single account can hold maximum amount up to Rs. 4.50 lakhs and in case of a joint account Rs.9 lakhs is permissible.
- Interest rate of 8.5% per annum payable monthly w.e.f. 01.04.2012
- Maturity period is 5 years.
- Claiming Bonus on Maturity has been undone w.e.f. 01.12.2011.
- Account can be opened by an individual, two/three adults jointly, and a minor through a guardian.
- You can avail a facility of premature closure of account after 1 year but on or before 3 years @ 2.00% discount.
- There would be a Deduction of 1% if account is closed prematurely at any time after three years.
- There is no Tax rebate
- Tax Deduction at Source (TDS) is not applicable.
- This scheme provides minors with a separate limit of investment of Rs. 3 lakhs and the same is not compiled with the limit of guardian.
- It also provides you with auto credit facility of monthly interest to saving account if both accounts are at the same post office.
- Deposits are also exempt from wealth tax.
- Opening of this account by Non-Resident Indian / HUF is not permissible.
- Nomination facility is also available under this scheme.
- You can also avail the facility of reinvesting your amount on maturity of the account.
Documents Required for Post Office Monthly Income Scheme
- Address Proof
- Two passport size photographs
- Identity Proof – This may include
ii) PAN Card
iii) Ration Card
iv) Voter Identity Card issued by the Election Commission of India
Note: You will be required to carry all the original documents for verification at the time of opening the account.
This scheme serves to be an ideal choice specially if you are a retired employee or a senior citizen as it brings home regular monthly income. This scheme is secure and risk free and ensures guaranteed return.
Though there is no Tax deduction at source but it is important to note that POMIS does not fall under the purview of Section 80C and thus you cannot claim for any tax exemption for the amount that you have parked in the scheme and the interest thus earned is taxable.
If you wish to get yourself registered with this scheme you can deposit money through demand draft, local cheque or cash. When you get enrolled with this scheme you will be issued a certificate of the scheme and also a passbook that will hold your transactions against the POMIS.
You can withdraw your amount on monthly basis or you may also keep it idle in the account and let it accumulate for few months and then withdraw it but it will not earn you any interest. To make it more convenient for you, you may get the monthly income auto credited in your savings account provided you have a savings account in the same post office where your scheme is running.
You may also combine your post office monthly scheme with a recurring deposit. You may invest the amount that you monthly earn through this scheme in a recurring deposit. By doing so you will be able to churn more capital gains in a more secured and risk free manner.
As stated earlier, this scheme also provides you with the facility of nomination. You can give the name of your nominee when you begin with the scheme or you can also do it during the course of the scheme. In the event of demise of the account holder, the money is paid to the nominee.
POMIS account can also be transferred from one post office to any other post office across the country without incurring any extra cost bringing smiles to faces who are constantly hopping from one place to another.
If churning decent capital returns without getting caught up in equity affair is on your mind or if you are a senior citizen or retired person who is looking for a monthly income then Post office monthly scheme could be a good investment option.
Contributed By: Megha Sharma
Megha Sharma works as a guest lecturer in Delhi. She holds an MBA & Doctorate from the UPTU. With extensive knowledge and experience in various financial products, she also works as a consultant in banking & finance domains wherein she offers advice to her clients in managing personal finance.
I and my mother had opened a joint account in MIS Post office in 2010 of 300000/- , monthly 2000/- interest what we were getting . Account first name was of my mother & second my . My mother expired in 2012 & now in 2016 the account got matured. I want to know that do i am applicable for tax on matured amount & how much.
- could you pls let me know the total duration for the deposit for five years or six years.
- i deposited 3,30000.00 at time and five years over.
- if I want to close the account now what benefits I will loose.
Why bonus facility is stopped on it when every body is trying to gain more and more money. Even MP pms are changing their salary say Rs. 75000 pm to Rs. 20000 pm. It our grief objection only.
Thanks and regards.
what are the taxation policy on benefit earned over principle .
how to get precise details for taxable amount for it return.
i want to know MIS maturity period a/c opened on 19/07/2011
In the above respect, I want to know whether the bonus received on maturity will be taxable?
(1) is my area police station is authorised for the same? The officer who signed on my police verification certificate.
(2) any other option i can go for?
I have a MIS account in Kolkata , I want to shift to another post office is that possible i can shift. Could you please guide me with the procedure.
you can shift MIS to any other post office. You have to visit the PO where u want shift and deposit your orinal passbook and u have fill form. They will do necessry tranfer for you. take identity like Adhhar, Election card , Pan card with you and residence proof
Please send me detail
Shall I get the interest rate @ 8.5% or less
take the amount, i dont have S/B Account in post office. how to check in post office. kindly
1. The account is in the 5th year. Will there be a deduction of 1%?
2. Will the 5%bonus apply?
3.which authority will be able to give clarity as there are varying views.
Q) If i have deposit Rs 201000 how much amount got after maturity?
Q) Any other bater scheme about fixed deposit?
Is there no TDS deduction on Interest?