NSC Calculator
Calculate the maturity value and interest earned on your National Savings Certificate (NSC) investments.
Investment Details
Min: ₹1000, Multiples of: ₹100
Current post office rate is ~7.7%
NSC VIII issue has a fixed 5-year tenure
Maturity Amount (at 5 Years)
₹1,44,903
Total Investment
₹1,00,000
Total Interest Earned
₹44,903
Maturity Breakdown
Yearly Interest Breakdown
Interest is compounded annually and reinvested.
| Year | Opening Balance | Interest Earned | Closing Balance |
|---|---|---|---|
| 1 | ₹1,00,000 | ₹7,700 | ₹1,07,700 |
| 2 | ₹1,07,700 | ₹8,293 | ₹1,15,993 |
| 3 | ₹1,15,993 | ₹8,931 | ₹1,24,924 |
| 4 | ₹1,24,924 | ₹9,619 | ₹1,34,544 |
| 5 | ₹1,34,544 | ₹10,360 | ₹1,44,903 |
Tax Hint (Sec 80C): The interest shown above for Years 1 to 4 is considered automatically reinvested. It qualifies for Section 80C deduction in the respective financial year!
Understanding National Savings Certificate (NSC)
The National Savings Certificate (NSC) is a popular, low-risk, government-backed savings bond available at Indian Post Offices. It is designed for small to mid-income investors seeking guaranteed returns along with tax savings.
Safety & Security
Because it is backed directly by the Government of India, NSC carries virtually zero risk of default. It offers capital protection and guaranteed compounding interest.
Tax Efficiency Trick
The initial deposit qualifies for Sec 80C. Since interest is compounded annually and reinvested, the interest earned in years 1-4 is also claimable under Section 80C as a fresh investment!
Frequently Asked Questions
What is National Savings Certificate (NSC)?
NSC is a fixed income investment scheme backed by the Government of India. You can open an NSC with any post office branch. It is a popular savings instrument because it offers guaranteed returns and tax benefits.
What is the lock-in period for NSC?
The lock-in period for NSC (VIII issue) is 5 years. Premature withdrawals are generally not allowed except in specific cases like the death of the certificate holder or by order of a court.
What are the tax benefits of NSC?
The principal amount invested qualifies for tax deduction under Section 80C up to ₹1.5 Lakhs per year. Additionally, the interest earned every year (except the 5th year) is reinvested and also qualifies for the Section 80C deduction.
Is the interest earned on NSC taxable?
Yes, the interest earned is taxable according to your income tax slab. However, since the interest is reinvested for the first 4 years, it can be claimed as a deduction under Section 80C. The interest paid out in the 5th (final) year is fully taxable.
Can I use NSC as collateral for a loan?
Yes, NSC can be pledged or transferred as security for obtaining loans from banks, housing finance companies, or public sector companies.