Tuesday, 28 May 2019

Sukanya Samriddhi Account rules for partial withdrawals, closure before maturity

Sukanya Samriddhi Account (SSA) is one of the prime investment options that can be considered for tax saving purposes along with building a sizeable corpus for the future of a girl child. Sukanya Samriddhi Account or Sukanya Samriddhi Yojana
is a kind saving option which offers an attractive rate of interest along with the benefits of tax saving on investment. Sukanya Samriddhi Yojana was started by the Narendra Modi-led National Democratic Alliance (NDA) government in 2015. 

The main objective of the investment scheme is to secure a sizeable corpus for a girl child and to attract the taxpaying guardians to open the account. The parents or the legal guardians of the girl child investing their money in Sukanya Samriddhi Account can claim the income tax deduction of up to Rs 1.5 lakh under Section 80C of the Income Tax Act. In Sukanya Samriddhi Account, a minimum of Rs 1,000 can be invested and the maximum investment can go up to Rs 1.5 lakh in particular financial year. 

All the Indian resident individual parents or legal guardians are eligible to open Sukanya Samriddhi Account for a maximum of two girl children before the girl child achieves the age of 10 years. A maximum of three Sukanya Samriddhi Accounts can be opened in case the firstborn or the second born are twin girls. Sukanya Samriddhi Account fetches an interest of 8.5 per cent per annum.

Sukanya Samriddhi Account rules for withdrawal before maturity 
  • Sukanya Samriddhi Account has a mandatory lock-in period of 21 years from the date of opening of the account and the account has to be discontinued in case account holder marries before 21 years of age.
  • The accumulated corpus in the Sukanya Samriddhi Account can be withdrawn only after completion of the lock-in period of 21 years.
  • However, the administration allows the premature withdrawal and closure of Sukanya Samriddhi Account. Sukanya Samriddhi Account can be closed prematurely on the basis of marriage, change of status such as change of citizenship and country of residence, only after maintaining deposits for 5 years. 
  • Sukanya Samriddhi Account can be prematurely closed in case the account is causing a financial burden on the girl child or there is an urgent medical requirement or in instances of death of a parent or guardian. 
  • The partial withdrawal facility on the Sukanya Samriddhi Account can be availed only for the specific purposes such as higher education and marriage of the girl, that too when the girl attains an age of 18 years. 

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