A well-liked plan where the account customer deposits an amount between Rs 1,500 and Rs 4.5 lakh for single holders of accounts and Rs 9 lakh for jointly held account holders and the rate of interest on the amount is returned each month. The deposit may be prematurely redeemed after one year but prior to three years at a discount of 2% of the deposit, and after three years at a discount of 1% of the deposit. (Discount means deduction from the deposit)
A Monthly Income Scheme (MIS) Account is a type of investment account offered by banks and post offices in India. It is a popular savings scheme designed to provide individuals with a regular and stable source of income. Here are some key features of the Monthly Income Scheme (MIS) Account:
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Investment Period: The MIS Account typically has a fixed investment period, usually five years. During this period, the account holder receives regular monthly income payments.
Interest Rate: The interest rate offered on the MIS Account is set by the government and is subject to change periodically. The interest earned is typically higher than that of a regular savings account, providing a competitive return on investment.
Monthly Income Payments: The primary benefit of the MIS Account is that it provides a fixed monthly income to the account holder. The interest earned on the account is paid out in monthly installments, providing a steady income stream.
Investment Limit: The MIS Account has a maximum investment limit set by the government, which may vary from time to time. Individuals can invest up to the maximum limit in the account, and the interest earned is calculated based on the invested amount.
Joint Account Option: The MIS Account can be opened as a joint account, allowing multiple individuals to invest together and receive monthly income payments jointly. This is beneficial for families or couples who wish to pool their funds and receive the income collectively.
Tax Implications: The interest earned from the MIS Account is taxable as per the individual’s income tax slab. The bank or post office deducts Tax Deducted at Source (TDS) on the interest if it exceeds the prescribed threshold.
Premature Withdrawal: In case of financial emergencies or urgent needs, premature withdrawal from the MIS Account is allowed. However, there may be certain penalties or charges associated with early withdrawals, and the interest payable may be adjusted accordingly.
It’s important to note that the specific terms and conditions of the Monthly Income Scheme (MIS) Account may vary between banks and post offices. It is advisable to consult with the respective institution to understand the detailed features, interest rates, investment limits, and other relevant information before opening an MIS Account.
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Key Features:
- Each joint holder has an equal share in each joint account for calculating an individual’s portion of a joint account.
- Both before and after an account is opened, a nomination facility is offered.
- Accounts may be transferred between post offices.
- Any post office will allow you to open an unlimited number of accounts, subject to the maximum investment amount by adding together all the balances.
- A minor who is 10 years old or older can open and manage an account that is opened in their name.
- You can open a joint account with two or three other persons.
- Each joint account has an equal share for each of the joint account holders.
- You can change a single account into a joint account and vice versa.
- The conversion of a minor’s account must be requested when he reaches legal adulthood.
- The maturity period is around 5 years.
