All about Post Office Monthly Income Scheme (POMIS)
By Anupama Deshpande | August 12, 2019
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Snapshot of Post Office Monthly Income Scheme (POMIS)
| Point | Description |
|---|---|
| What is Post Office Monthly Income Scheme (POMIS)? | Post Office Monthly Income Scheme (POMIS) is one of the safest investment options available to the investors that provides fixed regular income. It is a Government of India product. |
| Minimum Investment | Rs. 1,500 and in multiples of Rs. 1,500 thereafter |
| Maximum Investment | Rs. 4.5 lakhs (individually) & Rs. 9 lakhs (jointly) |
| POMIS Interest Rate | 7.60% p.a. for July-September quarter of 2019 (Rate of interest is reset by Ministry of Finance every quarter) |
| Interest option | Monthly |
| Interest Payment Dates | Payout will start after one month from making the investment |
| Tenure | 5 years |
| Reinvestment | Can be reinvested further for 5 more years |
| Mode of Investment | Cheque / Pay order / DD / Cash |
| Income Tax Benefit | No tax benefit is available under Section 80C of I-T Act |
| Transfer | It can be transferred to other post office of same city or any other city |
| Nomination | Depositor can nominate 1 person who can claim the account proceeds, if the investor is deceased |
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Benefits of Investing in Post Office Monthly Income Scheme (POMIS)
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- It is one of the safest investment instruments for citizens in India
- It is a Government of India product
- It offers Fixed Interest
- It can be opened very easily at any post office in India
- It is a source of regular income after retirement
- It offers very attractive returns, currently 7.60% p.a. payable monthly
- It provides tax benefit i.e. a tax deduction up to Rs 1.50 lakhs can be claimed under Section 80C of Income Tax Act 1961.
- It can also be withdrawn prematurely.
- It can also be renewed for a further period of 5 years.
- It provides nomination facility to the depositor.
Eligibility Criteria for Post Office Monthly Income Scheme (POMIS)
- Any resident Indian can open this account.
- NRIs cannot open this account.
- It can also be opened in the name of a child who has already attained the age of 10 years.
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Documents Required to Open Post Office Monthly Income Scheme (POMIS) Account
- Proof of Identity (any one): Passport/ Voter ID card/ Driving License/ Aadhaar Card
- Proof of Address (any one): Recent Utility Bill
- Photographs: 2 Passport size coloured photographs
Procedure to Open Post Office Monthly Income Scheme (POMIS) Account
Outlined below is a step-by-step process of opening a Post Office Monthly Income Scheme (POMIS Scheme) Account:
- Visit the post office where you want to open your savings account. POMIS online account opening is not possible.
- Ask for a POMIS application form.
- Fill up the form completely and sign it wherever needed.
- Attach photocopies of your photo identity proof, residential proof and 2 passport-size photos to the application form (Do carry the originals for verification).
- Get the form signed by the witness and nominee.
- Submit the duly filled form along with required documents.
- Submit the initial deposit through cheque or cash.
- If you deposit initial amount through cheque, date of cheque realization will be considered as the account opening date.
Premature Closure of Account under Post Office Monthly Income Scheme (POMIS)
It is possible to withdraw from the account under Post Office Monthly Income Scheme (POMIS) any time by paying some charges/ penalty as detailed below:
- Upto 1 year: No benefit
- From 1 year upto 3 years: Charges @2% of the deposit shall be deducted and the balance paid to the depositor.
- From 3 year upto 5 years: Charges @1% of the deposit shall be deducted and the balance paid to the depositor.
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Withdrawal of Monthly Interest from Post Office Monthly Income Scheme (POMIS)
Interest can be directly credited to your savings account of the same post office. If you are having your MIS account with a CBS post office, the monthly interest can also be directly credited to your savings account maintained with any other CBS post office.
Important Points related to Post Office Monthly Income Scheme (POMIS)
- Investment in the name of minor cannot exceed Rs. 3 lakhs
- You can open a joint account with 2 or 3 persons
- If the monthly payouts are not withdrawn, they do not earn any interest
- Any number of MIS accounts can be opened in any post office by a person subject to a maximum investment limit of Rs 4.5 lakhs by adding balance in all the MIS accounts
- There is no TDS on the interest income from Post Office Monthly Income Scheme( POMIS)
- Interest income from Post Office Monthly Income Scheme( POMIS) is taxable in your hands
- You can maximise your overall return from MIS account by transferring the payouts to a recurring deposit (RD) or SIP.
About Anupama Deshpande
Anupama is a Co-Founder of CodeForBanks.com. She is an MBA (Finance) and Chartered Financial Analyst (CFA). She also carries a Fellowship degree in Life Insurance Sector and is a Master of Computer Application (MCA). She is an expert in Finance Field with an experience of over 18 years on different managerial positions in finance industry including Stock Market, Depository and Mutual Fund Sectors. Apart from that she has remained for few years in the field of marketing as well. Her suggestions and advice for investments have been very useful to many people.Her vast interest & expertise in the field of finance have encouraged her to write the articles so that others can also get benefitted out of them. She never loses any opportunity to learn and be creative. She is a valuable asset for CodeForBanks.com & important resource to all those around her.