Also, remember that if the payment is delayed, there will be a loss in interest income since the deposit will earn interest from the date of actual deposit and will be calculated according to the provisions of PPF/SSA. For PPF, Jain says: “If the deposit is made between June 1 and June 10, you will earn interest for 10 months. The interest amount is paid on the highest balance between Day 1 and Day 10 of the month. If you make a payment after June 10, you will earn interest for the nine months, until March 2021. Interest is credited at the end of the year.”
This move is especially good in these times as many people may face fund crunch during the lockdown.
Small businesses, freelancers, and those whose salaries have been cut or who have been laid off get a much-needed breather. If you have 6-month expenses in hand, you should make the most of these extra three months to make up for the otherwise lost tax savings’ opportunity. Rachit Chawla, founder and CEO, Finway, says: “Since there are more than two months to go, don’t hurry to make the investments
now. There is no harm in waiting until, say, June 25. By that time, you will have better clarity on what’s happening in the economy, regarding further lockdowns, your job, your financial position, etc. That time decide if you want to invest or pay just the minimum amount to keep the account active.”
In such uncertain times, an essential thing is cash-in-hand. Remember for PPF/SSA, you can continue to deposit the money for FY20-21 as usual. Mathpal says: “What’s most important right now is liquidity. The more, the better. So, hold on to cash.” This time is a good learning experience for many who have not moved to online channels. Those who have invested in small-savings instruments via bank will find it easier to do so. For those who still do it physically, a visit to the post office will need to done to activate the online process.
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.