Post Office Time Deposit Account

Post office time deposit account is just like the bank fixed deposit account. These time deposits are meant for those investors who want to deposit a lump sum for a fixed period. Time deposit account can be opened at any post office with a minimum deposit of Rs. 200. There is no maximum limit for the account.

The amount can be deposited for 1year, 2year, 3year, and 5years. The deposited amount is repayable after expiry of the period for which it is made viz: 1 year, 2 years, 3 years or 5 years.

Interest is calculated on quarterly compounding basis, and is payable annually. Rate of interest varies according to the period of the deposit and is decided by the Central Government from time to time. Income tax relief is available on the amount of interest under the provisions of section 80L of Income Tax Act.

Premature withdrawals from all types of post office time deposit accounts are permissible after expiry of 6 months with certain conditions.