Interest rates

Know the characteristics, tax advantages, interest rates of the public provident fund

Public Provident Fund Calculator: The Public Provident Fund, or PPF, was launched by the Indian government years ago for the benefit of small savers, who have no appetite for risk. It is one of the most popular government-backed savings schemes in India. The PPF is a long-term investment option backed by a sovereign guarantee. Not only generally higher than FD yields, the PPF diet comes with several benefits for the common man. You can use the PPF account to accumulate long-term wealth.

Here are the features of PPF

– Investors can invest as little as Rs 500 per year and up to Rs 1.5 lakh per year in their PPF accounts.

– Investors can invest their money in their PPF account for up to 15 years in a row, as per the guidelines. However, if one does not need the money after 15 years, he can extend the term of the PPF account for as many years as needed. This can be done in blocks of five years by submitting a PPF Account Extension Form.

– The PPF is also one of the very few schemes that offers the public the opportunity to save taxes through its Exempt-Exempt-Exempt (EEE) feature, which means it is a tax saving option. totally tax-free savings. No tax will be levied on the capital, profits and accumulated amount at the time of withdrawal.

– A single adult who is a resident Indian can open a PPF account, while a guardian on behalf of a minor/insane can also invest in PPF.

PPF interest rate

The government has said that PPF interest rates will remain unchanged for the July-September 2022 quarter. The PPF offers one of the highest interest rates among small savings schemes, at 7.1% per year.

This is how you can withdraw PPF money

For early withdrawals, a subscriber may make a single withdrawal during a financial year after five years excluding the year of opening the account. Only 50 percent of the credit balance at the end of the fourth previous year or at the end of the previous year, whichever is lower, can be withdrawn.

After 15 years, a PPF subscriber takes payment when due by submitting the account closure form along with the passbook to the relevant post office.

(b) He or she may also hold the value at maturity in his or her account without a deposit. In this case, the PPF interest rate will apply and payment may be withdrawn at any time. Alternatively, the subscriber can make one withdrawal per fiscal year.

(c) The subscriber may also extend his account for an additional block of five years and so on (within one year from expiry) by submitting the prescribed extension form to the relevant post office.

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