Public Provident Fund Account

Public Provident Fund Account

Ø Ideal investment option for both salaried as well as self employed classes.

Ø Non-Resident Indians (NRIs) are not eligible.

Ø Investment up to INR. 1,00,000 per annum qualifies for IT Rebate under section 80 C of IT Act.

Ø The rate of interest on the subscriptions made to the fund on or after 01.12.2011 and balances at credit of the subscriber in the existing PPF account shall bear interest at the rate of eight point seven per cent (8.70%) per annum.

Ø Loan facility available from 3rd financial year upto 5th financial year. The rate of interest charged on loan taken by the subscriber of a PPF account on or after 01.12.2011 shall be 2% p.a. However, the rate of interest of 1% p.a. shall continue to be charged on the loans already taken or taken up to 30.11.2011.

Ø Withdrawal permitted from 6th financial year.

Ø Free from court attachment.

Ø An individual cannot invest on behalf of HUF (Hindu Undivided Family) or Association of persons.

Ø Type of Account	Ø Minimum limit	Ø Maximum limit
Ø Public Provident Fund(Individual account on his behalf or on behalf of minor of whom he is the guardian)	Ø INR. 500/- in a financial year	Ø INR. 1,00,000/- in a financial year

 

 

Ø From 1.4.2013, interest rates are as follows:-

Ø 8.70% per annum (compounded yearly).

o   An individual can open account with INR 5/- but has to deposit minimum of INR 500/- in a financial year and maximum INR 1,00,000/-

o   Joint account cannot be opened. 

o   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.

o   Nomination facility is available at the time of opening and also after opening of account. Account can be transferred from one post office to another.

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

o   Maturity period is 15 years but the same can be extended within one year of maturity for further 5 years and so on.

o   Maturity value can be retained without extension and without further deposits also.

o   Premature closure is not allowed before 15 years.

o   Deposits qualify for deduction from income under Sec. 80C of IT Act.

o   Interest is completely tax-free.

o   Withdrawal is permissible every year from 7th financial year from the year of opening account..

o   Loan facility available from 3rd financial year.

Ø No attachment under court decree order.