Post Office Monthly Income Scheme

Features:

• Only one deposit is available in an account.
• Only individuals can open the account; either single or joint.( two or three).
• Interest rounded off to nearest rupee i.e, 50 paise and above will be rounded off to next rupee.
• The minimum investment in a Post-Office MIS is Rs 1,000 for both single and joint accounts.
• The maximum investment for a single account is Rs 3 lakh and Rs 6 lakh for a joint account.
• The duration of MIS is six years.

Returns:
The post-office MIS gives a return of 8% plus a bonus of 10 per cent on maturity. However, this 10 per cent bonus is not available in case of premature withdrawals. The minimum investment in a Post-Office MIS is Rs 1,000 for both single and joint accounts.

Advantages:
Premature closure of the account is permitted any time after the expiry of a period of one year of opening the account. Deduction of an amount equal to 5 per cent of the deposit is to be made when the account is prematurely closed. Investors can withdraw money before three years, but a discount of 5%. Closing of account after three years will not have any deductions. Monthly interest can be automatically credited to savings account provided both the accounts standing at the same post office. The interest income accruing from a post-office MIS is exempt from tax under Section 80L of the Income Tax Act, 1961. Moreover, no TDS is deductible on the interest income. The balance is exempt from Wealth Tax.

How to Open:
You can buy a post office MIS at any post-office in India. When you open an MIS, you will get a certificate issued by the post office. In addition, the investor is provided with a passbook to record his transactions against his MIS.