These are frequently asked questions about the Senior Citizen Saving Scheme (SCSS), with answers based on those issued by the Reserve Bank of India and updated for the Senior Citizens' Savings Scheme, 2019 and its amendments up to 2023.
Can I open a joint account with anyone?
No. A joint account under SCSS can be opened only with your spouse.
How old does my spouse need to be for a joint account?
There is no age limit for the spouse. In a joint account, only the age of the first applicant (depositor) decides whether you're eligible to invest. The second applicant (the spouse) can be any age.
What is the joint holder's share of the deposit?
None. The whole investment in the account is treated as belonging to the first applicant (depositor) only, so the second applicant (the spouse) has no share in the deposit.
Can a husband and wife open separate accounts, each with a limit of Rs.30 lakh?
Yes. Both spouses can open individual accounts, joint accounts with each other, or both, with deposits of up to Rs.30 lakh each (the limit was raised from Rs.15 lakh in April 2023), as long as each of them is eligible to invest under the scheme rules.
Is there any income tax deduction or exemption?
Yes, on the deposit. What you invest qualifies for the Section 80C deduction (section 123 of the Income-tax Act, 2025), up to Rs.1.5 lakh a year, if you use the old tax regime. The interest is fully taxable under the normal income tax rules.
Is TDS deducted?
Yes. The interest has not been exempted from tax deduction at source, so TDS applies.
Is there a minimum limit for TDS?
Yes. For senior citizens, tax is deducted at source only if the interest paid in a financial year is more than Rs.1 lakh (the limit since April 2025). If your total income is below the taxable limit, you can submit Form 15H to avoid TDS.
Is TDS also deducted from unpaid interest paid to the legal heirs of a depositor who has died?
Yes. Tax is deducted at source even from interest paid or payable to the account holder's legal heir.
Does TDS apply retrospectively or only from a later date?
TDS has applied from the very first day SCSS, 2004 came into operation, even if the Central Government, the Reserve Bank of India or another authority issued a notification, circular or clarification later.
Can I nominate one person, or several?
Either. When you open the account, you can nominate one or more people who will be entitled to the money due on the account if you die.
Can I make a nomination after opening the account?
Yes. You can make a nomination at any time after opening the account and before closing it, by giving a nomination form, along with your passbook, to the deposit office.
Can I cancel or change a nomination?
Yes. Submit Form-10 (cancellation or variation of nomination) to the deposit office where your account is held.
Can I make a nomination on a joint account?
Yes. In that case the joint holder is first in line to receive the money if the depositor dies. The nominee's claim arises only after both joint holders have died.
Can a power of attorney holder sign the nomination form for the nominee?
No. A power of attorney holder can't sign the nomination form on the nominee's behalf.
In a joint account, can the account continue if the first holder dies before maturity?
Yes, if the spouse is the joint holder or the sole nominee and is eligible to open an SCSS account in their own right on the date of death (for example, is 60 or older). The spouse applies to the deposit office and continues the account on the same terms and conditions. But if the spouse also has an individual account, the individual account plus the deposit in the joint account can't exceed the maximum limit. If it does, the excess is refunded, so that the two together stay at the maximum limit.
What happens if husband and wife each have an individual account, with no joint account, and one of them dies?
The account of the spouse who has died can't be continued and must be closed. The nominee or legal heir applies for closure on Form-11 (the claim form for a deceased depositor's account), with the death certificate.
Is there a fee for making, changing or cancelling a nomination?
No. SCSS has no fee for making, changing or cancelling a nomination.
What is the age limit for retired defence personnel?
50. Retired defence services personnel (but not civilian defence employees) can invest once they are 50, as long as they meet the other conditions.
What counts as ‘retirement benefits’ for SCSS, 2004?
The SCSS Rules define "retirement benefits" as 'any payment due to the depositor on account of retirement whether on superannuation or otherwise and includes Provident Fund dues, retirement / superannuation gratuity, commuted value of pension, cash equivalent of leave, savings element of Group Savings linked Insurance scheme payable by employer to the employee on retirement, retirement-cum-withdrawal benefit under the Employees’ Family Pension Scheme and ex-gratia payments under a voluntary retirement scheme'. Since 2023 it also includes death gratuity, and the benefits paid when a government employee dies in service.
Can I invest only money received as retirement benefits?
It depends on your age. If you are 60 or older, it doesn't matter where the money comes from. If you are between 55 and 60 and have retired (on superannuation, voluntary or special voluntary retirement), or are a retired defence employee aged 50 to 60, you can invest no more than your retirement benefits in SCSS.
Is there a deadline for opening an SCSS account with retirement benefits?
Not if you're 60 or older. If you're younger than 60, these time limits apply.
(a) People aged 55 or more but under 60 who have retired on superannuation or otherwise (including VRS or special VRS) must open the account within three months of receiving the retirement benefits, with proof of the date they were paid.
(b) The spouse of a government employee who died in service after turning 50 can also invest the benefits received, as long as they meet the other conditions.
(c) Retired defence services personnel (but not civilian defence employees) can invest from the age of 50, within the same three-month limit, as long as they meet the other conditions.
Can I take a loan by pledging my SCSS deposit?
No. Pledging an SCSS deposit or account for a loan isn't allowed, because you then couldn't draw the interest regularly, which is the whole point of the scheme.
Can I withdraw my deposit early?
Yes, at any time, but there is a cost:
(i) If you close the account within one year of opening, the interest already paid to you is recovered from the deposit.
(ii) If you close the account after one year but before two years from opening, one and a half per cent of the deposit is deducted.
(iii) If you close the account on or after two years from opening, one per cent of the deposit is deducted.
If you have extended the account, you can close it any time after one year from the date of extension with no deduction. Within that first year of the extension, one per cent of the deposit is deducted.
Can NRIs, Persons of Indian Origin and Hindu Undivided Families invest in SCSS, 2004?
No. Non-resident Indians (NRIs), Persons of Indian Origin (PIO) and Hindu Undivided Families (HUF) can't invest in SCSS, 2004. If a depositor becomes an NRI after opening the account and while it is running, the account may continue until maturity on a non-repatriation basis, and it is marked as a non-resident account.
Can I transfer my account to another deposit office?
Yes. Apply on the transfer form (Form-5), with your passbook, at the office where your account is held.
Can I extend an SCSS account?
Yes, in blocks of three years, as many times as you like. Apply to the deposit office within one year after maturity, or after the end of each three-year block. The extended deposit earns the rate in force on the date of maturity.
Does an account that isn't extended keep earning interest after maturity?
Yes, but at a lower rate. If you neither close nor extend the account at maturity, it is treated as matured and you can close it at any time. Until then, the matured deposit earns interest at the Post Office Savings Account rate in force from time to time, up to the end of the month before the month you close the account.
What happens if an account was opened against the SCSS Rules?
It is closed immediately. The deposit is refunded to the depositor after deducting any interest already paid on it.
Do agents get a commission on this scheme?
No. Commission on the scheme was stopped with effect from December 1, 2011.