Understanding PPF: The Complete Guide to Public Provident Fund

What is PPF?

The Public Provident Fund (PPF) is a long-term savings scheme backed by the Government of India. Introduced in 1968, it remains one of the most popular investment options for risk-averse investors seeking guaranteed returns with tax benefits.

Key Features of PPF

• Lock-in Period: 15 years (extendable in blocks of 5 years)
• Minimum Investment: ₹500 per year
• Maximum Investment: ₹1,50,000 per year
• Interest Rate: Currently 7.1% per annum (revised quarterly)
• Tax Benefits: EEE status (Exempt-Exempt-Exempt)
• Compounding: Yearly

Tax Benefits

PPF offers triple tax exemption:

1. Section 80C: Deposits up to ₹1.5 lakh are tax-deductible
2. Interest Earned: Completely tax-free
3. Maturity Amount: Fully exempt from tax

Withdrawal Rules

Partial withdrawals are allowed from the 7th year onwards. The amount withdrawn cannot exceed 50% of the balance at the end of the 4th preceding year or at the end of the preceding year, whichever is lower.

Who Should Invest in PPF?

• Conservative investors seeking guaranteed returns
• Long-term wealth creators
• Individuals looking for tax-saving investments
• Retirement planners

Use our PPF Calculator to estimate your maturity amount!