Save Income Tax by investing in the future of your Girl Child

There are multiple ways of saving income tax if you are a salaried professional. What better to save money than investing in the future of your girl child or daughter. One of the most effective ways of doing so is through Sukanya Samriddhi Yojana.


Gone are the days when there was a clear demarcation between boys and girls, with girls typically drawing the short end of the straw. Today, girls are creating history, carving new roads for themselves and taking our nation to greater heights. The true potential of women cannot be realised until they get a strong platform, with education considered critical for their elevation. Traditionally, education was a domain for boys, with parents investing a sizeable chunk of their earnings to provide for them, but this has changed since independence, with more girls being enrolled in schools and parents now open to investing in their future.

Today, while one can’t say that there is equality when it comes to investing in both sexes, India is on a new path, where the importance of the girl child has become the focus for millions. One primary reason why girls were denied importance in the past was due to financial constraints, but the government aims to change that through the Sukanya Samriddhi Yojana, designed primarily to aid and benefit the girl child, helping her reach her true potential in life. Given past experiences where the girl child was neglected and viewed as a burden, the Sukanya Samriddhi Scheme aims to change this perspective, providing benefits to both the girl child and her family, motivating more people to utilise this scheme.

About Sukanya Samriddhi Yojana

The Sukanya Samriddhi Yojana (SSY) is an initiative designed to help the girl child fulfil her potential and was launched by Prime Minister Narendra Modi in 2015. Coming under the umbrella of the Beti Bachao, Beti Padhao campaign, it aims to build a bright future for the girl child in the country, ensuring that they get the right financial platform to do justice to their abilities. This scheme aims to motivate parents to invest in the wellbeing of their daughter, offering incentives to all parties concerned.

Features of Sukanya Samriddhi Yojana:

Some of the major features of Sukanya Samriddhi Yojana are mentioned below.

  • Flexible investments: Parents or guardians of a girl child can invest amounts which suit their budget, with provisions for investments ranging between Rs 1,000 and Rs 1.5 lakh per year.

  • Multiple account opening avenues: A Sukanya Samriddhi Yojana Account can be opened in either a post office or certain nationalised banks, allowing flexibility and ease of opening.

  • One account: Under the scheme, a parent/guardian can open a single account for their daughter. Multiple accounts for the same child are not allowed. A maximum of two accounts are permitted for two girl children in a family.

  • Account opening age: Parents/guardians of a girl child can open an account under this scheme till the girl reaches the age of 10 years. Accounts cannot be opened after she crosses this age.

  • Account maturity: A Sukanya Samriddhi Account matures 21 years after it is set up, with the account holder having an option to keep the account open even after maturity, in which case it continues to earn interest.

  • Account operation: The account can be operated by the girl child once she attains the age of 10 years, ensuring that the money is handled by her independently.

Benefits of Sukanya Samriddhi Yojana (SSY):

Some of the key benefits of Sukanya Samriddhi Yojana are mentioned below.

  • Tax benefits: To generate interest in this scheme, the government has offered a number of tax incentives to everyone concerned. Parents/guardians who open this account on behalf of their daughter/ward get tax excemption on their investment under Section 80C of the Income Tax Act. An additional tax benefit is provided when the girl withdraws the amount on maturity, with the entire amount exempt from tax. Any interest accrued during the period is also tax exempted, making this a triple tax benefit scheme.

  • High Interest: An account under this scheme currently earns an annual interest of 9.2% (as of 2015-2016). This is higher than traditional deposits, helping an initial investment grow over time.

  • Partial withdrawal: Partial withdrawal from the account is permitted after the girl becomes 18 years old, with 50% withdrawal allowed if she wishes to pursue higher education or decides to get married.

Eligibility and Documentation for Sukanya Samriddhi Yojana:

The basic eligibility criteria in order to utilise this scheme are mentioned below.

  • Age: This account can be opened by the parent or guardian of a girl child until the time she reaches the age of 10 years.

  • One account: Only one account can be created for a girl child. Multiple accounts for the same person are not permitted.

  • Accounts per family: A maximum of two accounts can be opened by a family which has two girl children. Additional accounts cannot be opened if a family has more than 2 daughters, except if twins are born after the first daughter.

  • Indian citizen: This account can be opened only for Indian citizens, with foreigners not eligible to open this account for their daughter.

Individuals who wish to open an account for their daughter need to submit the following documents.

  • Birth certificate: A copy of the birth certificate of the girl child is necessary before an account can be opened.

  • Identity Proof: A valid ID proof of the parent/guardian who is opening the account on behalf of their daughter/ward should be submitted.

  • Proof of residence: Applicants should submit their proof of residence. This can be either a Ration card, voter’s ID, utility bill, etc.

Frequently Asked Questions about Sukanya Samriddhi Yojana:

  1. How can one make deposits under this SSY scheme?
  2. A. Individuals can make deposits annually, either in the form of a lump sum or through systematic investments spread over time.

  3. Who can invest in this account?
  4. A. The parents or guardian of the girl child under whose name an account is maintained can invest in this scheme.

  5. Can one transfer a Sukanya Samriddhi Account from a post office to a bank?
  6. A. Yes, this account can be transferred from post offices to banks by filling out a transfer form and submitting it to the relevant authorities.

  7. Will the interest rate offered under this scheme remain constant?
  8. A. No, the government can change the interest rate under this scheme as per its discretion.

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