Top 5 Post Office Small Savings Schemes That Offer Section 80C Tax Benefits

April 15, 2025

Secure Returns + Tax Savings: These Post Office Schemes Are Ideal for Smart Investors

When it comes to safe investments with guaranteed returns and tax-saving advantages, Post Office Small Savings Schemes continue to be among the most trusted options. These government-backed schemes not only offer steady interest rates but also Section 80C tax deductions of up to ₹1.5 lakh annually, making them ideal for conservative investors.

Here are the top 5 post office schemes that help you save tax and grow wealth simultaneously.

1. Public Provident Fund (PPF)

The Public Provident Fund remains one of the most popular long-term savings options.

• Tax Benefit: Up to ₹1.5 lakh under Section 80C

• Lock-in Period: 15 years

• Interest Rate: 7.1% per annum (compounded annually)

• Key Advantage: Tax-free interest and maturity amount

• Minimum Investment: ₹500 per year

• Maximum Investment: ₹1.5 lakh per year

Perfect for those looking to build a retirement corpus with zero risk.

2. National Savings Certificate (NSC)

Ideal for mid-term investors looking for guaranteed returns and tax deductions.

• Tax Benefit: ₹1.5 lakh under Section 80C

• Lock-in Period: 5 years

• Interest Rate: 7.7% per annum (compounded annually, paid at maturity)

• Minimum Investment: ₹1,000

• Maximum Limit: No upper limit

The interest earned is taxable, but reinvested interest also qualifies for 80C benefits in the first 4 years.

3. Senior Citizen Savings Scheme (SCSS)

Tailored for senior citizens, this scheme ensures both regular income and tax savings.

• Tax Benefit: ₹1.5 lakh under Section 80C

• Eligibility: Individuals aged 60+

• Interest Rate: 8.2% per annum (paid quarterly)

• Minimum Investment: ₹1,000

• Maximum Investment: ₹30 lakh

• Lock-in Period: 5 years (extendable by 3 years)

It’s a reliable pension-style plan with higher returns compared to other post office deposits.

4. Sukanya Samriddhi Yojana (SSY)

A long-term savings plan for girl children, offering attractive returns and tax exemptions.

• Tax Benefit: ₹1.5 lakh under Section 80C

• Interest Rate: 8.2% per annum (compounded annually)

• Minimum Investment: ₹250 per year

• Maximum Investment: ₹1.5 lakh per year

• Maturity: 21 years from the date of account opening or until the girl turns 18 and marries

An EEE (Exempt-Exempt-Exempt) scheme — contributions, interest, and maturity are all tax-free.

5. Post Office Time Deposit (5-Year Tenure)

A fixed deposit-like savings plan that qualifies for tax savings only on 5-year term deposits.

• Tax Benefit: ₹1.5 lakh under Section 80C

• Interest Rate: 7.5% per annum (for 5-year deposit)

• Minimum Investment: ₹1,000

• Tenure: 1, 2, 3, and 5 years (only 5-year tenure is eligible for 80C benefit)

• Interest Payment: Annually

A good alternative to bank fixed deposits with government guarantee.

Conclusion: Safe, Tax-Saving, and Reliable

For investors looking for safe, risk-free investment options with tax-saving benefits, these post office schemes under Section 80C are solid choices. Whether planning for retirement, children’s future, or building wealth with guaranteed returns — these 5 schemes cover it all.