20 June, 2019 16:44 IST
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Post Office Schemes
 
PPF - Public Provident Fund
 
Features
 
Returns
Interest 9.0% p.a. (compounded annually) is credited to the PPF account at the end of each financial year.

Investment Limitation
Min Amount     Rs. 100/- and additional investment in multiples of Rs 5/-.

Max Amount    Rs. 60,000/-   (can be deposited in a max of 12 installments in a year)

Scheme Availability
A PPF account can be opened at anytime during the year. It is open all through the year.

Mode of Operation
  • Single
  • Joint (Two or more)
  • Minor with parent/guardian
  • HUF
Nomination
Nomination can be done at the time of opening the account or during the tenor of the account.

Tenure of Investment
15 years from the date of initial investment with a block of 5 years there-after upto a max of 30 years incl. 15 years.

Maturity
The PPF account matures after 15 years. One can then exercise on option of continuing the account for an additional block of 5 years or close it.

Loans
The first loan can be taken in the third financial year from the date of opening of the account, or upto 25% of the amount at credit at the end of the first financial year. The facility can be availed of any before expiry of 5 years from the end of the year in which the initial subscription was made. The loan is repayable either in lumpsum or in convenient installments numbering not more than 36. Interest at 1% would be charged if loan is repaid in 36 months. Such interest should of loan is not repaid within 36 months, interest on outstanding amount of loan would be charged at 6%.

Withdrawal
A withdrawl is permissible every year from the seventh financial year of the date of opening of the account, of an amount not exceeding 50% of the balance at the end of the 4th proceeding year or the year immediately proceeding the year of the withdrawal, whichever is lower, less the amount of loan if any.

Tax Benefits

Tax benefits can be availed under sections 88 for the amount invested. Interest accrued is Tax free.

Tips for Investing
  • Apart from a Post Office, a PPF account can also be opened in SBI & its associates and other select nationalized banks.
  • The most popular tax saving instrument which gives a rebate under section 88.
  • A PPF account cannot be attached by the Govt. or any court of law or through any decree.
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