Know about Kisan Vikas Patra Eligibility, Interest Rates, Maturity Period, Premature Withdrawal, Maximum Investment Limits, Transfer of KVP, Tax Benefits on Kisan Vikas Patra. Kisan Vikas Patra (KVP) is small saving certificate scheme which was originally re introduced in Budget 2014 presented by Finance minister Arun Jaitely with some major changes. Kisan Vikas Patra enables people to mobilize their small savings into long term saving plan. As the money invested and money received on maturity could be received in cash so KVP was discontinued in Dec 2011 on recommendation of Shayamla Gopinath committee that KVP can be misused for money laundering.
Kisan Vikas Patra Types
There is following types of Kisan Vikas Parta (KVP) :
- Single Holder Type Certificate
KVP issued to an Adult for himself or on behalf of a minor or to a minor.
- Joint A Type Certificate
Type A KVP is issued jointly to two adults, payable to both jointly or to the survivor.
- Joint B Type Certificate
Type B KVP is issued jointly to two adults, payable to either of holders jointly or to the survivor.
Major changes in Kisan Vikas Patra (KVP)
- Mandatory PAN Card for investments over ₹ 50,000/-
- Income Source Proof for investments over ₹ 10 lakh
- Maturity Proceeds would be transferred to Post office saving account
- No deduction u/s 80C allowed on amount invested in KVP
- Interest earned on maturity will be taxable
Eligibility for Kisan Vikas Patra
The applicant must satisfy the following eligibility criteria to invest in KVP –
- He must be adult and Indian Resident. NRIs cannot invest in this instrument.
- Two adults jointly can invest in KVP.
- Trusts can invest in KVP. HUFs (Hindu Undivided Family) not eligible to invest in KVP.
Investment Limit in Kisan Vikas Patra
Kisan Vikas Patra are available in denominations of ₹ 1000, 5000, 10000 and ₹ 50000)
- Minimum Deposit – ₹ 1000/-
- Maximum – No limit
There is no limit on number of certificates that can be purchased by the purchaser.
Kisan Vikas Patra Online
You can visit your nearest post office to make your investment in KVP. However, you can not apply online for Kisan Vikas Patra. The application form for purchasing KVP can be downloaded online by investors.
Who can issue Kisan Vikas Patra
- Post offices
- Agency banks through their designated branches which have been authorized to accept PPF scheme 1968
Maturity Period and Interest Rate on Kisan Vikas Patra
Maturity period of Kisan Vikas Patra is 118 months (9 years 10 months). After maturity period, the amount invested get doubled. Current Interest rate on Kisan Vikas Patra is 7.30 (effective from 1 Jan 2018).
If you made investment of ₹ 10000/- in KVP, it will get double to ₹ 20000/- after the maturity period of 118 months.
However, maturity period likely to change depending on the rate of interest which is announced by Government of India time to time. Interest rate is announced by Government of India as follows :
|S.No||Quarter (for which rate of interest would be effective)||Notice Date||Rate of interest to be based on FIMMDA month end G-Sec rate pertaining to|
|1||April – June||15th March||Dec-Jan-Feb|
|2||July – September||15th June||Mar- April- May|
|3||October – December||15th September||June-July-August|
|4||January – March||15th December||Sep – Oct – Nov|
Documents Required to Purchase Kisan Vikas Patra
The applicant must submit following documents with post office or designated bank branches to get Kisan Vikas Patra certificate.
- Application form for purchase of KVP (Through Agents) – Download here
- Application form for purchase of KVP (Through Direct Investment) – Download here
- Aadhaar Card, Pan Card (must in case of investment above ₹ 50000/-)
- Passport size Photograph
Payment can be made through Cash, Cheque / Demand Draft. Date of certificate will be same as date of payment. In case of cash mode payment, certificate will be issued immediately while in case of cheque /demand draft, a provisional receipt is issued which can be later exchanged for a certificate.
Nomination in Kisan Vikas Patra
Nomination facility is also available in case of Kisan Vikas Patra. The investor or purchaser of KVP can nominate any person who in case of death of certificate holder shall be entitled to receive or hold the KVP certificate.
The maturity proceeds of KVP will be credited to nominee account at maturity of the scheme.
Kisan Vikas Patra Transfer
- Transfer of Kisan Vikas Patra between Post Office and Banks
Kisan Vikas Patra may be transferred from post office or bank to any other post office or bank. To transfer a KVP certificate, investor must submit a handwritten consent at concerned post office or bank branch.
- Kisan Vikas Patra transfer from one person to another
Kisan Vikas Patra certificate can also be transferred from one person to another. To do the same, a written application must be submitted to the post office or bank branch where the certificate was purchased.
Kisan Vikas Patra Premature Withdrawal
The lock in period for premature withdrawal of Kisan Vikas Patra (KVP) is 2 years 6 months. The investor can approach the post office or bank branch and submit his / her application for pre mature withdrawal.
However, it can also be paid earlier in following cases –
- Death of certificate holder or any of the holders
- On order by court of law
- Forfeiture by a pledge or by Gazette Government Officer
Kisan Vikas Patra Tax Benefits / Exemption
The investments made in Kisan Vikas Patra are not eligibile for tax rebate under Section 80C. Section 80C allows for deduction of ₹ 1,50,000/- for investment made in Kisan Vikas Patra.
However, Investments made in PPF and NSC (National Saving Certificate) are allowed as deduction under Section 80C.
Interest accrued on investment in KVP is also taxable.