SCSS Rules & Guidelines 2026 — Complete Reference
All Senior Citizen Savings Scheme rules in one place — deposits, interest, tenure, extensions, premature closure, nomination, and transfer. Updated for FY 2025-26.
Deposit Rules
| Rule | Detail |
|---|---|
| Minimum deposit | ₹1,000 (in multiples of ₹1,000 only) |
| Maximum deposit | ₹30,00,000 across all SCSS accounts combined (raised from ₹15L in Budget 2023) |
| Mode of deposit | Cash accepted up to ₹1 lakh; cheque or DD required above ₹1 lakh |
| Deposit structure | Single lump sum only — no top-up or additional deposits to same account |
| Multiple accounts | Allowed at different banks/post offices; aggregate must not exceed ₹30,00,000 |
| Same branch restriction | Cannot open more than 1 SCSS account at the same branch in a calendar month |
| Early retiree cap | For age 55–60 categories, deposit cannot exceed the retirement benefits received |
| Excess deposit handling | Any deposit above ₹30L is refunded with Post Office Savings Account rate (~4%) |
Interest Payment Rules
| Rule | Detail |
|---|---|
| Current rate | 8.2% p.a. — confirmed for Q1 FY 2026-27 |
| Rate lock-in | Rate at the time of opening is locked for the full 5-year tenure |
| Interest type | Simple interest — not compounded |
| Credit dates | 1st April, 1st July, 1st October, 1st January — quarterly |
| Credit mode | Auto-credited to linked savings account via ECS/NACH |
| Unclaimed interest | Does not earn additional interest within SCSS; earns savings account rate in your bank |
| TDS threshold (age 60+) | TDS deducted only if annual interest exceeds ₹1,00,000 (Budget 2025) |
| TDS threshold (age 55–60) | TDS deducted if interest exceeds ₹50,000 |
| TDS rate | 10% (20% if no PAN provided) |
🔗 Also read
Tenure & Extension Rules
| Rule | Detail |
|---|---|
| Initial tenure | 5 years from date of account opening |
| Extension | Unlimited 3-year blocks — amended November 2023 (previously: only one extension) |
| Form for extension | Form B — must be submitted within 1 year of each maturity date |
| Extension rate | SCSS rate prevailing on the date of extension (not the original opening rate) |
| Fresh deposit on extension | Not allowed — only the original principal continues |
| If no action at maturity | Balance earns Post Office Savings Account rate (~4%) until account is closed |
| Early closure during extension | No penalty after 1 year of extension; 1% penalty within 1 year of extension |
Premature Closure Rules & Penalties
| When closed | Penalty | What you get back |
|---|---|---|
| Within 1 year of opening | No interest paid; any interest already credited is recovered from principal | Principal minus recovered interest |
| After 1 year, before 2 years | 1.5% of deposit deducted | Principal minus 1.5% |
| After 2 years (before maturity) | 1% of deposit deducted | Principal minus 1% |
| During extension (after 1 yr) | No penalty | Full principal returned |
| On death of account holder | No penalty | Full principal + accrued interest to nominee |
Premature closure form: Form 2. Only one premature closure is permitted per account.
Nomination, Transfer & Other Rules
- Nomination: One or more nominees can be appointed at any time. Minor nominees are allowed with a guardian specified. See SCSS Nomination Guide →
- Transfer: SCSS accounts are fully transferable across India — post office to bank, bank to bank, or bank to post office. Transfer fee: ₹5 per ₹1,000 (min ₹50, max ₹10,000). See SCSS Transfer Guide →
- Partial withdrawal: Not allowed. Only full premature closure (with penalty) is permitted.
- Loan facility: Not available against SCSS accounts (unlike PPF).
- Passbook: Issued at account opening; must be produced for all transactions.
- Online opening: Not available at post offices currently. Some banks (SBI via YONO, HDFC/ICICI via net banking) may allow it — verify with your branch.
- Form 15H: Submit at the start of each April to prevent TDS if your total income is below the taxable limit. See Form 15H Guide →
⚡ Key Takeaways
- Maximum deposit: ₹30,00,000 across all SCSS accounts (raised from ₹15L in Budget 2023)
- Interest rate: 8.2% p.a., locked at opening for full 5-year tenure
- SCSS uses simple interest — paid quarterly, not compounded
- Extensions: unlimited 3-year blocks since November 2023 amendment
- Premature closure penalty: 1.5% (before 2 years), 1% (after 2 years) — no penalty on death
- TDS threshold for 60+: ₹1,00,000 per year (Budget 2025 update)
Is This Page Right for You?
✓ Who should use this
- Someone about to open an SCSS account wanting to understand all the rules first
- Existing SCSS holders checking extension or premature closure rules
- Financial advisors and tax consultants advising senior citizen clients
- Anyone comparing SCSS rules with FD or PPF rules
⚠ Who should think twice
- Those looking for a scheme with partial withdrawal — SCSS does not allow this
- Investors wanting to top up their investment later — only single lump sum accepted
- Those needing monthly (not quarterly) payouts — consider POMIS instead
Pros & Cons
✓ Advantages
- Comprehensive government-defined rules — no hidden charges or ambiguity
- Unlimited extensions (since Nov 2023) — keep earning indefinitely in 3-year blocks
- Full portability — transfer SCSS to any bank or post office across India
- No penalty on death closure — family receives full amount without deductions
⚠ Limitations
- No partial withdrawals — must close full account if liquidity is needed
- No loan facility against SCSS balance (unlike PPF)
- Simple interest only — quarterly payouts do not compound within SCSS
- Excess deposit (above ₹30L) earns only ~4% savings account rate
📋 Disclaimer & Source: All SCSS data is sourced from the Ministry of Finance, Government of India and India Post official guidelines. Current rate of 8.2% p.a. is effective from April 1, 2026 (Q1 FY 2026-27). Next review expected: June 30, 2026. Rules are as per SCSS Rules 2004, as amended in November 2023 (unlimited extensions) and Budget 2023 (₹30L deposit cap). This page was last reviewed on April 15, 2026. Content is for informational purposes only and does not constitute financial advice. Consult a SEBI-registered financial advisor before making investment decisions. · Full Disclaimer
💰 Premature closure rules and penalties →
📆 Calculate returns for 5+3 year extension →
🔄 How to transfer your SCSS account →
📜 Nomination rules and process →
💸 Section 80C tax deduction on SCSS →
Frequently Asked Questions
No. SCSS accepts only a single lump sum at the time of opening. You cannot add to an existing account. However, you can open a new separate SCSS account at a different branch (subject to the ₹30L aggregate limit).
Any amount above the ₹30,00,000 limit is refunded to you with the Post Office Savings Account interest rate (currently ~4%), not the SCSS rate. The excess is automatically returned — you won't earn 8.2% on it.
You can close it, but the outcome is harsh — no interest is paid, and any quarterly interest that was already credited to your account is recovered from the principal being returned. So you receive less than your original deposit.
Before November 2023, SCSS could be extended only once (for 3 years). The November 2023 amendment removed this restriction — SCSS can now be extended unlimited times in successive 3-year blocks. This is a major benefit for retirees wanting long-term stable income.
Yes — a small transfer fee: ₹5 per ₹1,000 of deposit (minimum ₹50). For deposits above ₹2 lakh, the fee is capped at ₹10,000. The transfer does not affect your interest rate or maturity date.
No. Unlike PPF (which allows loans from year 3 to year 6 of the account), SCSS does not have any loan facility. If you need funds urgently, premature closure (with applicable penalty) is the only option.