Investment in Mahila Samman Savings Certificate is permitted only till March 31, 2025.
The money invested in 2 year FD and the income from that investment is not tax free
Earlier, when Finance Minister Nirmala Sitharaman presented the budget for this financial year, she had announced the Mahila Samman Savings Certificate (MSSC) scheme. In this scheme, which matures in two years, the government is providing interest at the rate of 7.5 percent. A minimum investment of Rs 1000 and a maximum of Rs 2 lakh can be made in this. Investment in Mahila Samman Savings Certificate is permitted only till March 31, 2025. It can be an alternative to fixed deposit in a bank with some differences. Let us compare this scheme with a normal bank FD account and consider its advantages and disadvantages.
The first difference is very clear. As the name suggests, Mahila Samman Savings Certificate is meant for women only. Recently Union Minister Smriti Irani also created account with MSSC scheme. On the other hand, a fixed deposit can be made by any individual, irrespective of gender.
MSSC has the option of premature withdrawal after one year. Withdrawals up to Rs 40,000 can be made after one year. Investments made in this scheme are not exempt from income tax. The interest earned on this will be subject to tax.
The money invested in 2 year FD and the earnings from that investment are not tax free. On two-year fixed deposits (FDs) maturing with an amount of less than Rs 2 crore, State Bank of India is offering 6.80 per cent interest rate to general citizens and 7.30 per cent interest rate to senior citizens. HDFC Bank is offering 7 per cent interest for regular customers and 7.5 per cent for senior citizens on two-year fixed deposits. You will have to pay charges to the bank if you withdraw the money before the FD matures.
Both Bank FD and Mahila Samman Savings Certificate with a tenure of 2 years do not provide tax exemption to the investors. When it comes to interest, the average customer gets a lower rate on bank FDs as compared to Mahila Samman Savings Certificates. Some banks offer interest rates as high as MMSC to old age people. Mahila Samman Savings Certificate is a better option for women to invest money for a period of two years.
read all latest business news, tax news And stock market update Here