Senior Citizen Savings Scheme notification 2023: SCSS investment limit doubles along with rate hike

Senior Citizen Savings Scheme notification 2023: The Government has notified the increase in the Senior Citizens’ Savings Scheme (SCSS) deposit limit to Rs 30 lakh per account. Along with the double deposit limit, the Government has also increased the SCSS interest rate to 8.2%.

In Budget 2023, Finance Minister Nirmala Sitharaman said that the SCSS deposit limit will be increased from Rs 15 lakh per account to Rs 30 lakh.

In the official notification dated 31st March 2023, the Finance Ministry said the scheme has been revised “in exercise of the powers conferred by section 3A of the Government Savings Promotion Act, 1873 (5 of 1873), the Central Government”.

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“In the Senior Citizens’ Savings Scheme (hereinafter referred to as the said Scheme), in paragraph 3, in subparagraph (7), for the words “fifteen lakhs”, the words “thirty lakh” shall be substituted,” the notification said.

“In the said Scheme, in paragraph 4, in sub-paragraph (1), for the words “fifteen lakh” at both the places where they occur, the words “thirty lakh” shall be substituted,” it added.

With the commencement of the new deposit limit, a senior citizen will now be able to deposit up to Rs 30 lakh in the SCSS account. In case a senior citizen and his/her spouse have separate SCSS accounts, they will be eligible to deposit Rs 30 lakh each in their respective accounts.

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Along with the SCSS deposit limit, the Government has also increased the SCSS interest rate for the first quarter (April-June) of the new financial year 2023-24 starting today. The SCSS depositors will earn 8.2% interest during April-June. In December, the Government increased the SCSS interest rate to 8% for the January-March quarter of FY 2022-23.

Deposits made by senior citizens in their SCSS accounts qualify for tax deduction under Section 80C of the Income Tax, subject to the limit of Rs 1.5 lakh per year. The SCSS deposits mature in 5 years. However, the scheme provides an option to extend the account for another three years.