Post Office Monthly Income Scheme

Post Office Letter Boxes, EC1A 1AA .London Chief Office 1994photo © 2008 Felix O | more info (via: Wylio)

Couple of weeks ago, I wrote about Monthly Income Plans or MIPs, and this week I’m going to write about a similar monthly income scheme from the Indian post office called the Post Office Monthly Income scheme.

This is a fixed income scheme which provides you a guaranteed return on your investment, and is meant for people who are looking for a monthly source of income without taking any risk at all.

Where the mutual fund MIP invests a part of its assets in equity, and even gold in some cases – and may sometimes even get you a higher than 10% return (with commensurate risk of course) this scheme has a fixed rate of return and is meant for people looking for an ultra safe investment.

Here are some features of this scheme.

Post Office MIS Interest Rate

This is a scheme from the Indian postal service that earns you an interest of 8% per annum, and generates a monthly income for you.

So if you invest Rs. 100,000 in it – your annual interest at 8% will be Rs. 8,000, and you will get Rs. 666.67 monthly.

Post Office MIS Tenure

The maturity period of the scheme is 6 years, at the end of which you will get your money back. You cannot redeem your money within a year, but you can redeem it after that upon paying a penalty.

Here is how that works.

Less than 1 year: MIS can’t be encashed.

1 – 3 years: You are penalized 2% of deposit.

After 3 years: You are penalized 1% of your deposit.

5% Bonus

If you retain your Post Office MIS till maturity (6 years) – at the end of the time period you will be given a 5% bonus on your deposit.

Minimum and Maximum Investment

The minimum sum you can invest is Rs. 1,500, and you can go up to Rs. 450,000 in case of a single account, and Rs. 900,000 in case of a joint account.

Tax on Post Office MIS

There is no TDS on the Post Office MIS, but the interest income is taxable in your hands. The interest income from post office MIS used to be tax free under section 80L, but that section has been withdrawn from April 1 2005.

Interest can be automatically credited to your bank

At the time of opening the scheme you can give in your bank account details, and interest will be automatically credited to your bank every month.

Transfer from one post office to another

There is a provision that allows you to transfer your money from one post office to another. So, if you opened your account in one post office, and moved to another place you can fill up a transfer form with them, and move your scheme to another post office.


This scheme is meant for people who are looking for an ultra safe investment and a regular source of monthly income on top of it. A lot of retired people will fall under this category, and if you fall under that category then you need to evaluate other options like the Senior Citizens Savings Scheme before you invest in this scheme. I”ll cover that scheme in the days to come, and if you have any questions about this particular scheme or any other observations please leave a comment.

255 thoughts on “Post Office Monthly Income Scheme”

  1. I had kept in post office MIS Rs 684000/- in Nov 2010. I get Rs 4560/- per month as Monthly Income in my account. This works out to 8% interest. So far I had not checked this interest. I feel rate applicable at that time was positively more than 8%. Could you please clarify what was the rate applicable for deposits in 2010? If yes can anything be done? Appreciate reply. Thanks

  2. My question is as under.

    ‘A’ ( Mail) & ‘B ( Femail)’ is a couple. Both they have joint MIS account in post with deposit of 4.5 lacs each. I.e. In one account ‘A’ is main holder & ‘B’ is associate Holder with deposit of 4.5 lacs & In other Account’B’ is main Holder & ‘A’ is associate holder with deposit of 4.5 lacs. In case if ‘A’ died before maturity, then whether ‘B’ can get benefit of interest of his Joint account with ‘A’ where she is associate holder, up to Maturity ? & at the same time, whether she can also take benefit of Interest of Her Own account where She is Main holder ?

  3. a person has illegally opened 3 single MIS accounts each with rs. 4.5 lacs in different post office. what legal actions can be taken against him? where can we file a complaint against him?

  4. I am nominee in one of the Post Office MIS deposit of my aunt, who expired last year in June. The deposit will mature in 2017. If i retain the MIS till maturity whether i will be entitled to interest rate of the MIS ? If yes, can i ask post office to credit monthly interest in my SB account with Post Office.

  5. death ke bad bonus milega ya nahi our death ke bad intt milega ya nahi a/c mature ho gayi hai

  6. Sir
    My self omparkash .my father open TD A/C IN POST OFFICE YEAR 2014 INVEST AMT IN- 50000 NOMINEE IS MY MOTHER AND SISTER NAME IS DAYAWATI AND SUNITA ( KAMLESH)unfortunate my father is expire to Oct 2015 my sister nick name is Sunita but school document and I’d prof is kamlesh k naam s h post office service women ka khana h ki aapko y money nhi milegi because aapki sister k I’d prof sab kamlesh k naam s h so plz sir I need help u ..mujhe aap is a/c ka. Claim ka prossiger bato WO medem to mana kr rehi h k mujhe iske claim k bare m nhi pata aap kisi or sinior department m baat karo iske liye ….plz sir aap mujhe batye ki y claim kaise hoga…plz plz

    1. Affidavit kara lo namo ka before the magistrate take help from a local lawyer then deposit ur docs with the affidavit to the post office.

  7. I had opened a MIS account for Rs.66000/- i 2010 and at that time bonus was 10% on maturity. Subsequently, after 2 to 3 years, they changed the bonus to 5% for new accounts. Now when I surrendered the MIS account for closure, Post Office paid me only 66,000/- plus 5% bonus i.e, Rs.3,3000 instead Rs. 6,600/-. Is this correct? Or I am eligible to get 10% bonus. Please clarify thru my e-mail.

    1. Are you sure about the 10% maturity bonus in 2010, because as per my information prior to FEB 2006 the bonus was 10% & in FEB 2006 the same was discontinued but w.e.f. December 8, 2007 the government has reintroduced the bonus option on maturity in the scheme but with a lower rate of 5%. Further I myself have a MIS opened in AUG 2010 & right from that time itself I am aware that the Maturity Bonus is 5%.

  8. My MIS interest lying with Kolkata GPO and this account is due after 6 years i.e.on 08-01-2016. I am living at Hindmotor,Hooghly and also opened a savings a/c at Hindmotor post office. Now how I can transfer /credit my accumulated interest and original MIS maturity money? pl. tell me the way of getting such money

  9. Can I invest Rs1500 the 1st month and then different amounts such as 3000 or 4500 the next the Post Office MIS or its a fixed amount investment scheme?

  10. Dear Sir,

    I deposited some money under MIS to Dharmatala PO, Writers’ Building PO, Income Tax PO and Park Street PO. Now, from this month the above post offices refuse to pay MIS by withdrawal slip else they insist me to open a Savings account in that PO. I came to know that in your recent circular, while opening account in Park Street HPO, they told me that as per recent circular received by them on 19.12.15 payment of MIS will be made as usual and no Savings A/c need to be opened for that. But the other POs insist me to open an account with them. Please tell me how many PO accounts will be opened by me? Can I transfer all my deposits from other POS to a single Po? Please advice.

  11. Hello sir,
    My father opened an mis in Mumbai 5 years back and now it is matured. He wants to widthdraw it but the passbook is in another city in my brothers house. Can he request for transfer in his local post office and widthdraw the amount with his certificate number?

  12. My parents were having 2 joint a/c in POMIS each of Rs.300000/- from 28/08/2010. My mother expired on 22/09/2015. So our post office suggest my father to close one account because as a single a/c he was crossing the prescribe limit.
    In this case PO charged him 1% penalty as Premature closing. On the other hand PO processed this transaction as Death claim and prepared cheque worth Rs.315000/-. While paying to my father they are asking 18000/- as cash which is difference of (315000-(300000-1% penalty)).
    What is correct procedure to handle this situation?

  13. Dear Sir,

    Can you please clarify the following :

    Suppose A & B having a joint B account in Post Office MIS for Rs.900000/-. How the interest is to be taken in to their account which filing their respective income tax return?
    Is it 50:50? or
    According to the first named depositor? or
    According to the source of income provided? or


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