Sukanya Samriddhi Yojana (SSY): Features, Interest Rates, and Tax Benefits

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Niyati Mistry

Income Tax
Tax Savings & Deductions
Last updated on January 12th, 2024

Sukanya Samridhhi Yojana (SSY) is a government-backed savings scheme in India that was introduced in 2015 by the Ministry of Finance as a part of the “Beti Bachao Beti Padhao” (Save Girl Child, Educate the Girl Child) campaign. Sukanya Samriddhi Yojana Scheme encourages parents to set aside funds for their daughter’s education and wedding expenses as it aims at the betterment of girl children in India.

Moreover, the SSY scheme is ideal as it offers attractive tax advantages and interest rates.

Features of the Sukanya Samriddhi Yojana Scheme

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Sukanya Samriddhi Yojana Eligibility

The Sukanya Samridhhi Yojana Scheme eligibility criteria are as below:

Note: One cannot open multiple Sukanya Samriddhi accounts for the same girl child.

Sukanya Samriddhi Yojana Interest Rate

Sukanya Samriddhi Yojana Interest Rate for Q4 of FY 2023-24 is 8.2% p.a. compounded annually. Previously the interest rate was 7.6% p.a. The interest amount along with the principal amount is paid on the maturity of the SSY account.

The government revises the Sukanya Samriddhi Yojana Interest Rate quarterly.

Sukanya Samriddhi Yojana Tax Benefits

The Sukanya Samridhhi Yojana tax benefits are as below:

The investments made under Sukanya Samriddhi Yojana fall under the EEE (Exempt, Exempt, Exempt) Category.

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How to open an Account for Sukanya Samriddhi Yojana?

An account can be opened at any of the authorized banks or any post office. The form to open an account is available at all eligible bank branches and post office branches. The guardian can fill out the form and submit the same along with the necessary documents and the deposit fee. SSY accounts become active after the verification process.

Documents required to open Sukanya Samriddhi Account:

SSY Withdrawal Rules

The following scenarios permit withdrawal:

In both cases, the girl child should have attained the age of 18 years.

The account holder can withdraw a maximum of 50% of the account balance in the previous year. Moreover, there are alternatives to withdraw money in a lumpsum manner or 5 instalments as per the requirement.

SSY Closure Rules

Closure on Maturity

The maturity period is when the girl child turns 21 years old or upon her marriage after 18 years. Hence, upon maturity, in exchange for submission of an application along with proof of identity, and citizenship documents, the girl child receives the account balance including the interest amount.

Premature Closure

The following scenarios permit pre-mature closure:

Transfer of SSY Account

One of the major benefits of SSY is the ease of convenience. The of the SSY account from one part of the country to another can be done without any hassle. The only requirement is to fill up the form for transfer of the account and submit it to the concerned post office or bank.


How can the Sukanya Samridhdhi Yojana account get deactivated/inactive?

The Sukanya Samriddhi account will turn inactive in case the requirement of the minimum annual deposit of INR 250 is not met. However, to revive the account a penalty of INR 50 along with the minimum deposit amount is to be paid.

How many times can a deposit be made in Sukanya Samriddhi Yojana?

The amount deposited in the Sukanya Samriddhi account should not exceed INR 1.5 lakhs per year. However, the total number of deposits made doesn’t matter either in a month or a financial year.

Can a loan be availed against the amount in Sukanya Samriddhi Yojana?

No, currently availing of a loan against the SSY balance is not allowed.

What will happen in case of unforeseen death of the depositor?

In case of unforeseen death of the depositor, the account is either closed and the accumulated amount is given to the family or girl child. Or, the account is kept running till the maturity period and the deposited amount continues to earn interest till the girl child attains the age of 21 years.

Is the maturity amount on withdrawal of the SSY scheme taxable?

No, the SSY scheme falls under the EEE (Exempt, Exempt, Exempt) category. Hence, the maturity amount (inclusive of interest) is exempt from tax.

Can the application for the Sukanya Samriddhi Yojana Scheme be made online?

Currently, there are no provisions to apply for Sukanya Samriddhi Account online. Hence, the guardian can visit the Post Office or your bank branch and submit the application to open an SSY account.

Got Questions? Ask Away!

  1. Hi @Gowtham

    Every parent wants to give their kids a solid financial future, and almost all include things like their children’s education and marriage on their list of financial objectives. One might not benefit from simply keeping money aside in a bank account because investments need to keep up with inflation. By getting started early, you give the power of compounding time to do its magic and help you build a sizable corpus.
    In my opinion, these are some investment tools can be taken into account when you invest and save money for children:

    1. Sukanya Samriddhi Yojana: It is best for a girl child. It is a savings scheme to cover the girl child’s education and wedding expenses. The scheme offers income tax deductions on savings and fixed interest rates against the deposits.
    2. PPF: The Public Provident Fund (PPF) account has a lock-in period of 15 years and can be opened with a bank or post office. A PPF account can be opened in one’s own name as well as in the name of a minor. Interest is generally obtained at higher rates than standard FD rates and is tax-free to the investor. For increments of five years, the account may be renewed. One of the few investment products, PPF, has the exempt-exempt-exempt (EEE) designation, which provides triple tax exemptions. You receive tax exemption at the time of investment, accrual, and withdrawal, according to this.
    3. Equity Funds: Since investments are made in equities, returns from such investments tend to beat the rate of inflation and enjoy liquidity benefits as well. Example: ELSS, ULIP etc
    4. Life Insurance Products
    5. Investment in Gold
    6. Bank Fixed Deposits

    Read more about Income Tax Deductions a Taxpayer can Avail - Learn by Quicko

    Hope this helps.

  2. Thanks for explaining the investment avenues.

    Can you explain on the gifting and taxation done from parent to child perspective?

  3. Hi @Gowtham

    Sometimes, parents or relatives send gifts or cash to children during special occasions or festivals.

    What is the tax implication of this?
    According to the Income Tax Act, a gift from certain relatives is tax-free irrespective of the amount. Relatives include: Husband/wife, son/daughter (including stepchild and adopted child), father/mother (including step-father/mother), daughter-in-law/son-in-law, brother-in-law (and his wife), sister-in-law (and her husband) is tax-exempt.
    Beyond this, if one receives any gift from non-relatives such as friends, step-brothers/sisters, nephews/nieces, and cousins, the value of the amount received is more than ₹50,000, then the entire amount is taxable.
    Read more about Tax on Gift: Rules and Exemptions As per Income Tax Act in India | Quicko.

    Hope this helps!

  4. person “x” is having 4 parents .
    2 biological parents and 2 adopted parents .
    Are the assets received as gift/transfer from all the 4 parents to the person “x” ; tax-free in the hands of the receiver ?


  5. Hi @HIREiN,

    As per the stated case, the gift received is tax-free in hands of the receiver.