What is PPF Account and Benefits of Investing in PPF

What is PPF Account and Benefits of Investing in PPF: The Public Provident Fund is savings-cum-tax-saving instrument in India, introduced in the year 1968 by the National Savings Institute of the Ministry of Finance. The main aim of the scheme is to mobilize small savings by offering an investment with reasonable returns and income tax benefits. PPF can be opened in post office and some authorized branches of bank. 

The PPF scheme is a popular long term investment option backed by Government of India which offers safety with attractive interest rate and returns that are fully exempted from Tax .Investors can invest minimum Rs. 500 to maximum Rs. 1,50,000 in one financial year and can get the facilities such as loan, withdrawal and extension of account. The Public Provident Fund (PPF) account can be opened by resident Indian Individuals and individuals on behalf of minors. 

PPF Account and Benefits of Investing in PPF Account:

There will be attractive interest rate of 8.7% that is fully exempted from Income Tax under section 80 C. There will be Good long term investments of 15 years. The Deposits can be done maximum in 12 transactions. The Loan can be availed between 3rd to 6th financial year.

The Partial withdrawal facility can be availed from 7th financial year onwards. The Account can be extended in a block period of 5 years after maturity. There is no attachment under court decree order and the PPF account can be opened in a Post Office which is Double handed and above. 

The Deposits can be made in lump-sum or in 12 installments. And an individual can open account with INR 100 but has to deposit minimum of INR 500 in a financial year and maximum INR 1,50,000. The person joint account cannot be opened.

The account can be opened by cash/ cheque and in case of cheque, the date of realization of cheque in Govt. account shall be date of opening of account. The nomination facility is available at the time of opening and also after opening of account. The account can be transferred from one post office to another.

The Maturity value can be retained without extension and without further deposits also. The premature closure is not allowed before 15 years. The interest is completely tax-free. The nomination facility is available at the time of opening and also after opening of account and the account can be transferred from one post office to another.

The subscriber can open another account in the name of minors but subject to maximum investment limit by adding balance in all accounts. 

The maturity period is 15 years but the same can be extended within one year of maturity for further 5 years and so on. There may be many key advantages in investing in PPF accounts like Useful for retirement planning, Tax-free returns, Low risk, Easily accessible, No attachment and attractive long-term investments.

PPF is being government-backed, there is low risk of default. Long-tenures, compounded, tax-free returns and capital protection make PPF an ideal option for retirement planning.
What is PPF Account and Benefits of Investing in PPF What is PPF Account and Benefits of Investing in PPF Reviewed by amara sangati for Rating: 5