National Saving Certificate and Deduction Section 80c

National Saving Certificate and Deduction Under Section 80c are related to each other. The Government of India issues this Certificate. It provides tax free interest half yearly(8%) and annually(8.16%). Deduction under section 80c is qualified by NSC. NSC is available only for individuals and there is no limit for investments. As you know that NSC qualifies deduction under section 80c, then at the and of the year you can reinvest the amount whatever has come from entire year. Likewise, the 5 year period interest portions is qualified for deduction section 80c. But wait for a while, you can't reinvest the 6th year interest because the 6th year interest is not eligible for deduction under section 80c. And taxable also. The another point to taken care of is that there is no pre-mature encashment. It is transferable to one person to another and one post office to another.