PPF stands for Public Provident Fund. As an investment option, this is mostly preferred by the individuals for saving tax. But this is good option for those as well who are not liable to pay tax. This works as per PPF Act, 1968.
PPF has the following features:
PPF has the following features:
- This account is opened for 15 years.
- This account can be opened in the name of any individual or minor under guardianship.
- Account can be opened by residents only.
- HUF cannot open PPF account effective 13th May, 2005.
- After 15 years, this account can be extended for 1 or more block of 5 years.
- Rate of Interest on PPF varies from 8% to 9%. This rate every year is decided by the Govt.
- Minimum Investment to be done is INR 500 and maximum permitted investment is INR 1,50,000 in an year effective Aug, 2014. Only 12 deposits can be made in an year.
- Nomination facility is also available.
- Tax benefit is available for invested amount u/s 80C.
- Interest on maturity is fully tax exempt.
- This account can be opened in Authorised Banks and Post Offices only.
- This account can be transferred from one bank to another bank/ post office and vice versa.
- Loan and withdrawal facility is also available on the basis of age and deposit amount.
- One person can have only one PPF account at any point of time.
- The balance in PPF account cannot be attached to any claim in case of debt or liability