Sukanya Samriddhi Yojana: Eligibility, Tax Benefits, Rules – All you need to know

Sukanya Samriddhi Yojana (SSY) was launched by Prime Minister Narendra Modi on 22 January 2015 as part of the Beti Bachao Beti Padhao (BBBP) Campaign. Backed by the Indian Government, the small savings scheme is exclusively for the girl child, with the main objective of encouraging families to save for their child’s marriage expenses and invest in the child’s education. The account can either be opened at authorised branches of commercial banks or at any post office. Apart from a high rate of interest, there are also tax benefits under this small savings scheme. 

The interest rate for this scheme is 8.5% (1 January 2019 to 31 March 2019). The small savings scheme provides tax benefits under Section 80C of the Income Tax Act, 1961. 

A Sukanya Samriddhi Yojana account can be opened from the time of birth of the girl till she reaches the age of 10. In an ongoing financial year, the minimum deposit under this scheme is Rs.250 while the maximum deposit is Rs.1.5 lakh. 

Rules of Sukanya Samriddhi Yojana scheme 

Some of the main rules and eligibility criteria of a Sukanya Samriddhi Yojana account are: 

• The natural or legal guardian can open an account in the name of the girl till she reaches the age of 10. 
• Must be a resident citizen of India. 
• Only one account can be opened by the depositor in the name of the girl. Two accounts cannot be opened for one girl.  
• If the minimum deposit of Rs.250 is not made, the account will be discontinued. To continue the account thereafter, the depositor will have to pay a fine of Rs.50, along with the year’s minimum specified subscription. 
• After the girl turns 18 years old, partial withdrawal of 50% of the balance is allowed for higher educational purposes. Proof of admission must be provided.  
• The account matures after 21 years from the date the account was opened or if the girl gets married. 
• After the girl turns 18 years old, she can operate the account on her own. 
• A maximum of two accounts can be opened in a single family. 
• Three accounts can be opened if the family has twin girls and another girl child. 

Documents needed for opening a Sukanya Samriddhi Yojana Account 

The documents that are required for opening a Sukanya Samriddhi Yojana account are: 

• The girl child’s birth certificate 
• The depositor’s ID proof 
• The depositor’s residential proof 
• The child’s and depositor’s photographs 
• Filled Sukanya Samriddhi Yojana form 
• The account opening form is available at the RBI website, which is 

https://rbidocs.rbi.org.in/rdocs/content/pdfs/494SSAC110315_A3.pdf .

Interest rates of Sukanya Samriddhi Yojana Account 

Based on the G-sec yields, interest rates are fixed on a quarterly basis.  

Since its launch, the rate of interest is as follows: 

Period	Rate of interest
From 1 April 2014	9.1%
From 1 April 2015	9.2%
1 April 2016 – 30 June 2016	8.6%
1 July 2016 – 30 September 2016	8.6%
1 October 2016 – 31 December 2016	8.5%
1 July 2017 – 31 December 2017	8.3%
1 January 2018 – 31 March 2018	8.1%
1 April 2018 – 30 June 2018	8.1%
1 July 2018 – 30 September 2018	8.1%
1 October 2018 – 31 December 2018	8.5%
1 January 2019 – 31 March 2019	8.5%

Compound interest on a yearly basis will be credited into the account and rate of interest is notified by the government. For a calendar month, interest is calculated on the lowest balance available in an account on the deposits that are made between the close of the 10th day of the month and the last day of the month.

Tax benefits under Sukanya Samriddhi Yojana scheme 

There are multiple tax benefits that are available under the Sukanya Samriddhi Yojana scheme. It is one of the biggest draws of the scheme as well. The tax benefits available under this scheme are: 

Under Section 80C of the Income Tax Act, you are eligible for tax deductions for deposits up to Rs.1.5 lakh. 

The proceeds/withdrawal and interest earned upon maturity is tax-free. The interest is also compounded annually.  

Modes of deposit 

The deposits can be made in the form of demand draft, cheque, or cash. The name of the account holder and the account number from which the deposit is to be credited must also be mentioned.   

E-transfers can also be done at the concerned post offices or banks provided Core Banking Solutions (CBS) are available with them. 

Transfer of Sukanya Samriddhi Yojana Account 

If the girl child in whose name the account is in decides to shift to another state or city in India, the account can be transferred. On providing proof of change of residence of either the account holder or the parent/guardian, the account can be transferred free of cost. A charge of Rs.100 is levied if no proof is submitted. Provided there is CBS facility available at post office or banks, the account can be transferred electronically. 

Benefits of a Sukanya Samriddhi Yojana Account 

Some of the main benefits of a Sukanya Samriddhi Yojana account are: 

• Rate of interest is high: Compared to many small saving schemes, SSY provides a high rate of interest. Currently the rate of interest is 8.5%. 
• Small amount required to open account: Rs.250 is the minimum deposit required to open an account. The maximum deposit that can be made in an account is Rs.1.5 lakh.  
• Under special circumstances premature withdrawal is possible: If the banks or post offices find out there is a financial burden to maintain the account, premature withdrawal is possible. This can be done only upon completion of 5 years of maintaining the account.  
• Savings for your daughter’s expenses on education: If proof of admission is provided, 50% of the balance can be withdrawn for educational purposes when the girl turns 18. 
• Duration of deposits is 15 years: After 15 years and till maturity, no deposits are required to be made on the account. 

Since the scheme is backed by the Government of India, the risks involved are very low. Also, ensuring the survival and protection of girls, abolishing sex discrimination practices, and to ensure high participation of girls in education are the main aims of the BBBP.