Post Office Monthly Income Scheme
The Post Office Monthly Income Scheme is a Government of India-backed small savings scheme that allows the investor to set aside a particular amount every month.
POMIS only offers monthly interest payments to investors (singly or jointly).
Individuals (s) or minors aged 10 years and above can invest in the plan.
This scheme is a safer investment option compared to equity shares and many fixed-income options.
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To open an MIS account with any post office in India, a person should be any of the following:
A single adult.
Joint Account (up to 3 adults).
A guardian on behalf of minor (a minor above 10 years in his own name).
- Deposit Limit
The account shall be opened with a minimum deposit of Rs 1000/- or any sum in multiple of Rs 100/- and there shall be only one deposit in an account.
A maximum of rupees Rs 4.50 lakh can be deposited in a single account and 9 lakh in Joint account.
- Maturity tenure
MIS Account may be closed on expiry of Five years from the date of opening by submitting prescribed application form with pass book at concerned nearby Post Office.
In a condition, the account holder dies before the maturity, the account may be closed and amount will be refunded to nominee heirs.
Account Interest will be paid up to the preceding month, in which refund is made.
- Nomination Facility
Nominee facility available and can be updated later after opening an MIS account by a beneficiary.
Loan facility is not available.
- Transfer Facility
POMIS account can be easily transferred from one Post Office to another.
- Tax Benefits
This scheme doesn’t come under the section 80C of the IT Act 1961. Moreover, it has no Tax Deducted at Source (TDS) either.
The MIS account holder may be permitted to withdraw the deposit and close the account at any time after the expiry of a period of 1 year from the date of opening of account by making an application in Form-2 (Premature Closure), subject to the terms and conditions that –
- if the account is closed on or before the expiry of 3 years from the date of opening of such account, an amount equal to 2% of the deposit shall be deducted and the remainder shall be paid to him.
- If the account is closed after the expiry of 3 years from the date of opening of such account, an amount equal to 1% of the deposit shall be deducted and the remainder shall be paid to him.
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From 1 April 2020, Interest rates are as follows:-
- 6.6 % p.a. payable monthly.
- Interest shall be payable to the MIS account holder on completion of a month from the date of deposit.
- If the interest payable every month isn’t claimed by the holder such interest shall not earn any extra interest.
- Interest shall be rounded off to nearby multiple of one rupee.
- If the date of payment of monthly interest falls on non-working day or a holiday, the payment shall be deemed to be due on the working day immediately preceding that Sunday or a holiday.
- Account interest is taxable in the hand of depositor.
Monthly Income Scheme for Senior Citizens
POMIS schemes do not offer any extra interest to senior citizens.
Hence, the interest earnings on a particular sum are the same regardless of whether the investor is over or under 60 years of age.
- The deposit can be made individually or jointly.
- A minor aged 10 years or above can avail the POMIS Account.
On turning 18 years, he/she will be asked to convert his/her minor account to an adult account.
- The Post office credits proceeds directly to the investor’s savings account on a monthly basis through ECS.
- Easy transfer from one CBS Post Office to another CBS Post Office.
- One can add nominee even after opening the POMIS account.
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Documents Required for Post Office Monthly Income Scheme
|Proof of Identity||Aadhaar card, Voter’s ID card, Pan Card, etc.|
|Proof of Address||Aadhaar card, Electricity bill, Water bill, Ration card, etc.|
|Photographs||2 recent passport-sized photographs|
How to Open a Account?
You can open a POMIS in any post office across India using an offline process.
To offline open a POMIS account, the following points must be considered.
- Open a post office savings account, if you haven’t already.
- Download the application form & fill required mandatory fields.
- Collect the needed documents and visit any nearby post office branch of India Post.
- Submit the copies of all the mandatory document along with a duly filled up application form.
- You will need to get the signatures of your witness or nominee on the form.
- Make the initial deposit (Rs. 1000/-) via cash/cheque. If you give a post-dated cheque, that date will be considered as the MIS account opening date.
- On the successful opening of POMIS, make sure to take the receipt for future references.
PO Monthly Income Scheme Calculator
POMIS Scheme interest rate is currently at 6.6%.
This means a subscriber can gain as much as Rs 29,700/- in the form of annual interest if he invests Rs 4.5 lakh in MIS.
Although, in a condition of a joint account, the net investment can be doubled up to Rs 9 lakh and in such a case the annual returns would jump to Rs 59,400.
If we divide this net amount by 1 year, then one would get a monthly income of Rs 4,950.
Source – Post office