What is Post Office Monthly Income Scheme (POMIS)?
Post Office Monthly Income Scheme (POMIS) is a government-backed savings scheme that provides a fixed monthly income. It is one of the safest investment options for generating regular monthly income, backed by the sovereign guarantee of the Government of India.
POMIS is particularly popular among retirees, senior citizens, and anyone seeking predictable monthly cash flow without market risk. The current interest rate for Q4 FY 2025-26 (January to March 2026) is 7.4% per annum, paid monthly.
Key Features of Post Office MIS
- Interest Rate: 7.4% p.a. (paid monthly), reviewed quarterly.
- Tenure: 5 years from the date of deposit.
- Minimum Investment: ₹1,000 (multiples of ₹1,000).
- Maximum - Single Account: ₹9,00,000 (₹9 Lakh).
- Maximum - Joint Account: ₹15,00,000 (₹15 Lakh).
- Interest Payout: Monthly (credited to linked savings account).
- Government Guarantee: 100% safe, sovereign guarantee.
- Nomination: Facility available.
How is POMIS Interest Calculated?
Post Office MIS pays simple interest at 7.4% per annum, divided into 12 monthly payments. The formula is:
Or simplified:
Example Calculations:
| Investment | Monthly Income | Yearly Income | 5-Year Total |
|---|---|---|---|
| ₹1,00,000 | ₹617 | ₹7,400 | ₹37,000 |
| ₹5,00,000 | ₹3,083 | ₹37,000 | ₹1,85,000 |
| ₹9,00,000 (Single Max) | ₹5,550 | ₹66,600 | ₹3,33,000 |
| ₹15,00,000 (Joint Max) | ₹9,250 | ₹1,11,000 | ₹5,55,000 |
POMIS Tax Treatment
- Investment: No tax deduction under Section 80C (unlike PPF, NSC, SCSS).
- Interest: Fully taxable as "Income from Other Sources".
- TDS: No TDS is deducted on POMIS interest.
- Tax Filing: You must declare the interest income in your ITR.
Premature Withdrawal Rules
| Closure Period | Penalty |
|---|---|
| Before 1 Year | Not Allowed |
| After 1 Year, Before 3 Years | 2% of Principal Deducted |
| After 3 Years, Before 5 Years | 1% of Principal Deducted |
| After 5 Years (Maturity) | No Penalty - Full Amount Returned |
POMIS vs SCSS: Which is Better for Seniors?
| Feature | Post Office MIS | SCSS |
|---|---|---|
| Interest Rate | 7.4% | 8.2% |
| Payout Frequency | Monthly | Quarterly |
| Max Investment | ₹9L / ₹15L (Joint) | ₹30 Lakh |
| Age Eligibility | Any Age | 60+ Years |
| 80C Benefit | No | Yes |
Verdict: Senior citizens should prefer SCSS for higher returns and tax benefits. POMIS is better for those below 60 who need monthly income.
Frequently Asked Questions (FAQs)
What is the Post Office MIS interest rate in January 2026?
The Post Office MIS interest rate for Q4 FY 2025-26 (January to March 2026) is 7.4% per annum, payable monthly. This rate is reviewed by the government every quarter.
Can I open multiple MIS accounts?
Yes, you can open multiple MIS accounts across different post offices. However, the total investment across all accounts (single + joint share) cannot exceed ₹9 lakh for single accounts and ₹15 lakh for joint accounts.
What if I don't withdraw monthly interest?
If you don't withdraw the monthly interest, it gets deposited into your linked post office savings account. The interest in savings account earns 4% per annum. You can also opt for auto-credit to your bank account.
Can NRIs invest in Post Office MIS?
No, only resident Indians can invest in Post Office MIS. NRIs and foreign nationals are not eligible.
Can I extend MIS after 5 years?
No, unlike SCSS, Post Office MIS cannot be extended. After 5 years, you receive your principal back and must open a new account if you wish to continue.