The Post-Office Monthly Income Scheme (MIS) provides monthly payment of interest income to investors. It is meant for investors who want to invest a sum amount initially and earn interest on a monthly basis for their livelihood.  MIS is not suitable for an increase in your investment. It is meant to provide a source of regular income on a long term basis. The scheme is, therefore, more beneficial for retired persons. 

How to open MIS?

You can buy a post office MIS in any of operation post-office centers in India. When you open an MIS, you will get a certificate issued by the post office. In addition, the investor is provided with a passbook to record his transactions against his MIS.

Features of MIS

Only one deposit is available in an account. Only individuals can open the account; either single or joint.( two or three). Interest rounded off to nearest rupee i.e, 50 - paisa. Any higher amount than this will be rounded off to next rupee. The minimum investment in a Post-Office MIS is INR 1,000 for both single and joint accounts. The maximum investment for a single account and joint account is put to INR 3- Lac and INR 6- Lac respectively. The duration of MIS is 6- years. 

Returns through MIS

The post-office MIS gives a return of 8% on maturity. The minimum investment in a Post-Office MIS is INR 1,000 for both single and joint accounts.

Advantages of Post-Office Monthly Income Scheme

Premature closure of the account is permitted any time after the expiry of a period of one year of opening the account. Deduction of an amount equal to 5% of the deposit is to be made when the account is prematurely closed. Investors can withdraw money before three years, but at deduction of 5%. Closing of account after three years will not have any deductions. Monthly interest can be automatically credited to savings account provided both the accounts standing at the same post office.

Moreover, no TDS is deductible on the interest income. The balance is exempted from Wealth Tax.