Kisan Vikas Patra

Kisan Vikas Patra is a saving certificate scheme which was first launched in 1988 by India Post. It was successful in the early months but afterwards the Government of India set up a committee under supervision of Shyamala Gopinath which gave its recommendation to the Government that KVP could be misused. Hence the Government of India decided to close this scheme and KVP was closed in 2011 and the new government re-launched it in 2014.

Kisan Vikas Patra can be purchased by :

  • An adult in his own name, or on behalf of a minor
  • A Trust
  • Two adults jointly

Investment limitations

KVP certificates are available in the denominations of Rs 1000, Rs 5000, Rs 10000 and Rs 50000. The minimum amount that can be invested is Rs 1000. However, there is no upper limit on the purchase of KVPs.

Tax benefits

Kisan Vikas Patra does not offer any income tax benefits to the investor. No deduction u/s 80C is allowed on investment and the interest received upon maturity/withdrawal is fully taxable. However, withdrawals are exempted from Tax Deduction at Source (TDS) upon maturity.

Interest income

The amount (Principal) invested in Kisan Vikas Patra (KVP) would get doubled in 115 months as per existing rate of interest for the financial year 2023-24. The rate of interest was slashed to 6.9% with effect from 1 April 2020[1] to 31 March 2021. Now the rate of interest increased to 7.5%.[2]

Withdrawal

The amount of KVP can be withdrawn after 124 months (10 years and 04 months). The maturity period of a KVP is 2 years 6 months (30 months). Premature encashment of the KVP certificate is not permissible. The certificates can only be encashed in event of the death of the holder or forfeiture by a pledge or on the order of the courts.

References
  1. Singh, Sandeep. "From April 1, Kisan Vikas Patra Interest Rate Cut To 6.9%, Maturity Period Extended". NDTV. Archived from the original on 31 October 2020. Retrieved 25 November 2020.
  2. Mondal, Anupam (23 May 2023). "Kisan Vikas Patra (KVP) Calculator Post Office Interest Rate". Nivesguru. Retrieved 8 October 2023.
This article is issued from Wikipedia. The text is licensed under Creative Commons - Attribution - Sharealike. Additional terms may apply for the media files.