IndiaFilings / Learn / Government Initiatives / Post Office Time Deposit Scheme
Post Office Time Deposit Scheme - All Details | Indiafilings

Post Office Time Deposit Scheme - All Details

The Post-Office Term Deposit (POTD) Scheme is an investment savings account scheme offered by the India Post (Department of Posts). This scheme is meant for those depositors who want to deposit a lump sum of money for a fixed five-year tax-saving fixed deposits. In this article, we look at the Post Office Time Deposit Scheme in detail. To know more about the Post Office Recurring Deposit Scheme

Eligibility Criteria

The Post-Office Time Deposit (POTD) Account Scheme can be opened by any person who satisfies the below criteria.
  • Any Indian who is over 18 years of age.
  • Two persons jointly (Minors of age over 10 years and above can open the account jointly with their guardian)
  • Parent or guardian can open this Time Deposit account on behalf of a minor.
Note:
  • Group Accounts, Institutional Accounts and Miscellaneous account not permissible.
  • Trust, Regimental Fund or Welfare Fund not permissible to invest.

Features of the Post-Office Term Deposit Scheme

The below listed are the main features of the Term Deposit Account by the India Post.
  • The Term Deposit account can be opened by cash as well as the cheque. In case of cheque, the date on which the amount deposited would be the date of the presentation of the cheque.
  • The account’s maturity period shall be of 5 years and can also be extended for the next years on year to year basis.
  • This five-year Post-Office Term Deposit Scheme also offers with return on investment and tax deduction.
  • After completing majority, the minor who opened the account has to apply for the change of the account on his name.
  • A single account can be changed into a joint account and vice versa.
  • Nomination facility is also available that the account holder can nominate during the account opening or even after the opening of the time deposit account at the ease.
  • The depositor can get the tax benefit on the investment made for 5 years scheme under section 80C.
  • Fixed Deposit account will be automatically renewed after attaining maturity period.
  • One can get capital protection under the post office time the Indian Government backs deposit scheme.
  • It offers guaranteed return charged at the time of opening account.
  • It offers liquidity as the cash can be withdrawn at any time. The money can also be borrowed against this time deposit.

Post Office Time Deposit Interest Rates

The interest rate provided would be of 7.4% on Time Deposit  Account of a post office for 5 years. Kindly refer the below table to know about current interest rate applicable to post office fixed deposit.
Period Rate
1 Year Account 7.00%
2 Year Account 7.00%
3 Year Account 7.00%
5 Year Account 7.80%
The fixed deposit rates mentioned in the post office are variable and changes from time to time. Hence, make sure to check the current post office fixed deposit interest rate, before opening an account. The above interest rates are reviewed every quarter by the Finance Ministry.

Post Office Time Deposit – Tax Benefits

The tax benefit is not applicable for small tenure. The tax benefit can be obtained only if the time deposit account scheme is opened for 5 years. The tax exemption benefit is provided under section 80C of the Income Tax Act. The maximum limit applicable is Rs. 1.5 Lakhs for the tax benefit.

Procedure to open Post Office Time Deposit

To open a Post Office Time Deposit Account, the depositor has to follow the below procedures.

Approach a Post Office

Step 1: First the applicant must decide the Post Office where they want to open the account.

Get Application Form

Step 2: Then get the required application form from the relevant post office that has chosen and have to fill out the post office time deposit application form in a prescribed format. Note: The user may also download the Post Office Time Deposit Account Opening Form online.

Fill in the Right Credentials

Step 3: Fill the Post Office Time Deposit Account Opening application form with appropriate details without making any mistakes. Then provide the given following details in the application form.
  • Applicant’s Name
  • Residential Address
  • Applicant’s Date of Birth
  • Detail of Know Your Customer (KYC)
  • Nomination Details
  • Details of First deposit
  • Aadhaar card number
Step 4: Submit the time deposit account application form application form in the prescribed format to the relevant official along with all the supporting documents/ certificates.

Attach Required Documents

Step 5: After completing, attach the PAN Card, Address Proof, and all the ID proof records along with the application form. And carry the originals documents for the in-person KYC verification purpose.

Submit the Application

Step 6: After completing the application form, submit the same and start operating the account.

Post Office Time Deposit – Withdrawal Rule

The early closure of fixed deposit is allowed. However, there are certain specific conditions. The account can not be withdrawn early only after 6 months of the deposit. If the account is withdrawn early after 6 months but before the expiry of one year from the date of the amount deposited, simple interest at the applicable rate to Post Office Saving Account from time to time would be payable.
SINDUJA S
Updated on: January 18th, 2023

Popular Post

Download ePAN Card – Get ePan from NSDL & UTIITSL
80 Small Business Ideas

Starting a small business can be a transformative venture, offering the exciting opportunity...

Nadakacheri – Income Caste Certificate Download Online in Karnataka
TDS Rate Chart for Financial Year 2025-2026 (Assessment Year 2026-2027)

Tax deduction at source, shortly and popularly known as TDS, was introduced by the Income Tax...

Divorce Rules in India: Everything You Need to Know
How To Download GST Registration Certificate Online?

Goods & Services Tax Certificate is issued to people who are registered under GST...

PAN Card Cancellation Online
Find Complete Details of GST Registration Procedure

GST registration applies to all individuals and entities supplying goods or services in India. GST...

Check Your PF Claim Status Online Using PF Tracking ID
Gift Tax in India: Applicability, Exemptions and Rules

Gift tax in India is applied when the value of the received gift exceeds ₹50,000 in the...

Check Your PF Claim Status Online Using PF Tracking ID
Old Regime vs New Regime 2025: Which Tax Regime is Better for You?

The Union Budget 2025 has brought significant changes to India’s personal income tax structure, raising the...

Check Your PF Claim Status Online Using PF Tracking ID
What is the minimum turnover for GST?

The Goods and Services Tax (GST) is an indirect tax system introduced in India in 2017. It functions...

Check Your PF Claim Status Online Using PF Tracking ID
How can I check if a trademark is registered?

A trademark search is simply checking if another person or organization does not already own the...

Check Your PF Claim Status Online Using PF Tracking ID
Section 194H of the Income Tax Act: TDS on Commission & Brokerage

Section 194H of the Income Tax Act in India mandates the deduction of Tax at Source (TDS) on commission or brokerage...

Check Your PF Claim Status Online Using PF Tracking ID
Section 80G Deduction - Income Tax Act

Section 80G Deduction is a facility available in the Income Tax Act which allows taxpayers to...

Check Your PF Claim Status Online Using PF Tracking ID
Crypto Tax in India: Taxation On Cryptocurrency

The Income Tax Department (ITD) has not provided specific guidance on crypto taxes for Indian investors. However...

Check Your PF Claim Status Online Using PF Tracking ID
Internal Audit Applicability Under Companies Act, 2013

Internal audit applicability is a critical concept for companies in India, impacting various...

Check Your PF Claim Status Online Using PF Tracking ID
Difference between Private and Public Company

In the business world, two main types of companies exist: private company and public company...

Check Your PF Claim Status Online Using PF Tracking ID
New GST Rules for Rent

Ministry of Finance vide a Notification No 05/2022- Central Tax (Rate) dated 13.7.2022 has issued...

Check Your PF Claim Status Online Using PF Tracking ID
GSTR-1 and GSTR-3B Due Date Extension - New Due Dates For January 2025

The Central Board of Indirect Taxes and Customs (CBIC) has recently announced an extension...

Check Your PF Claim Status Online Using PF Tracking ID
Different Depreciation Rates under Companies & Income Tax Act

Depreciation is a key concept in finance and accounting. It helps us manage how the value of...

Check Your PF Claim Status Online Using PF Tracking ID
Form 10IA - Section 80DD Deduction

Form 10IA of the Income Tax Department must be filed by taxpayers claiming income tax deduction...

Check Your PF Claim Status Online Using PF Tracking ID
GST on Used Cars: New 18% Tax Rate Explained

The Goods and Services Tax (GST) system in India has been a significant reform in the country's...

Check Your PF Claim Status Online Using PF Tracking ID
MSME Registration - Udyam Registration

India's Gross Domestic Product (GDP) benefits significantly from the substantial...

Check Your PF Claim Status Online Using PF Tracking ID
Section 43B(h) - New MSME 45 Days Payment Rule

The Finance Act, 2023 introduced the MSME 45-day payment rule under Section 43B(h) of the Income Tax Act...

Check Your PF Claim Status Online Using PF Tracking ID
Direct Tax Vivad Se Vishwas (DTVSV) Scheme, 2024

The Direct Tax Vivad Se Vishwas (DTVSV) Scheme, 2024, was announced by Union Finance Minister...