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The Union Govt. on 7th December 2007 restored bonus on the once-popular monthly income scheme of Post Office and extended tax benefit under Section 80C to five year Post Office Time Deposit and senior citizen savings schemes. It has also announced a bonus on maturity at the rate of 5% on deposits made under the post office monthly income account scheme, taking its annual return to 8.9% from the earlier 8.3%. But there will be no tax benefits on this scheme.
The bonus on MIS is restored at the reduced level of five percent against ten percent earlier. The bonus would be applicable to new accounts under the scheme from Saturday (8.12.2007).
The tax benefit on the POTD Scheme is aimed at attracting more funds under small savings, but a personal finance expert says the measure is not good enough to lure new depositors as there are better avenues available.
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