National Savings Certificate (NSC) Calculator
The National Savings Certificate (NSC) is a fixed-income investment scheme that you can open with any Post Office branch in India. The scheme is a Government of India initiative, making it a highly secure investment option. It is popular among investors looking for safe returns and tax benefits under Section 80C.
How to Use the NSC Calculator?
Our NSC Calculator is designed to simplify complex maturity calculations. To use it:
- Investment Amount: Enter the amount you wish to invest in NSC.
- Interest Rate: Enter the current annual interest rate (e.g., 7.7%).
- Tenure: The lock-in period for NSC VIII Issue is typically 5 years.
The calculator instantly computes the total interest earned and the maturity value based on annual compounding.
Key Features of NSC
- Guaranteed Returns: Being a government-backed scheme, it offers guaranteed returns with no market risk.
- Tax Benefits: Investments up to ₹1.5 Lakh in a financial year qualify for tax deduction under Section 80C of the Income Tax Act.
- Compounding: The interest is compounded annually but is payable only at maturity. Interestingly, the accrued interest for the first 4 years is deemed to be reinvested and also qualifies for tax deduction under Section 80C.
- Loan Facility: NSC certificates can be pledged as collateral to obtain loans from banks.
NSC Interest Calculation Formula
The maturity amount for NSC is calculated using the compound interest formula:
A = P × (1 + R/100) ^ N
- A = Maturity Amount
- P = Principal Investment Amount
- R = Rate of Interest
- N = Number of Years (5 years)
Frequently Asked Questions (FAQs)
Is NSC interest taxable?
The interest earned on NSC is taxable. However, since the interest is reinvested for the first 4 years, it can be claimed as a deduction under Section 80C. The interest earned in the final year is fully taxable.
What is the lock-in period for NSC?
The NSC VIII Issue comes with a mandatory lock-in period of 5 years. Premature withdrawal is generally not allowed except in specific circumstances like the death of the holder or court orders.
Can I invest in NSC online?
Yes, if you have a savings account with internet banking in a bank or post office, you can invest in e-NSC online. Alternatively, you can visit the nearest post office.
Is there a maximum limit for investment in NSC?
No, there is no maximum limit for investment in NSC. However, the tax deduction under Section 80C is capped at ₹1.5 Lakh per financial year.
Disclaimer: This NSC Calculator provides estimates based on the current interest rate announced by the government. Interest rates are subject to quarterly revision. Please consult your post office or financial advisor for the latest rates and rules.
