PPF Account - (Public Provident Fund)
Public provident fund(PPF):-
The Public Provident Fund is a savings-cum-tax-saving
The Public Provident Fund is a savings-cum-tax-saving
instrument in india. introduced by the National Savings Institute of the Ministry of Finance in 1968. The aim of the scheme is to mobilize small savings by offering an investment with reasonable returns with income tax benefits. The scheme is fully guaranteed and safe and easy by central government. Income Tax & other Government authorities can attach the account for recovering tax dues.
In this article we have know that the following topics:-
- What is PPF Account?
- Who is eligible to open PPF Account?
- How to open PPF Account?
- How to withdrawal our money from our PPF Account?
- The tax benefits of investing in PPF Account?
- Features of PPF Account?
1. What is PPF Account?
Public Provident Fund(PPF) scheme is a long term investment option which is offers an attractive rate of interest and returns on the amount you have to invested. And also the interest earned and the returns are not taxable under income Tax 80C. One has to open an PPF account under this scheme and the amount deposited during a year you will be claimed under income tax section 80C deductions.
2. Who is eligible to open PPF Account?
An Individuals who are residents of India are eligible to open their account under the Public Provident Fund, and are entitled to tax-free returns.
3. How to open PPF Account?
A PPF account can be opened with either a Post Office or with any nationalized bank like the SBI (State Bank of India) or Punjab National Bank, etc. And now these days, even certain private banks like HDFC, ICICI, Axis And Kotak Mahindra Bank among others are authorized to provide this facility. You need to submit the duly filled application form along with the required documents i.e. the KYC documents like identity proof, address proof, and signature proof. Post submitting these documents you can deposit a prescribed amount towards the opening of the account.
4. How to withdrawal our money from our PPF Account?
As a rule, one can close a PPF account only upon maturity And after the completion of 15 years. Upon completion of 15 years, the entire amount standing to the credit of an account holder in the PPF account along with the accrued interest can be withdrawn freely and the account can be closed.
A PPF account can be opened with either a Post Office or with any nationalized bank like the SBI (State Bank of India) or Punjab National Bank, etc. And now these days, even certain private banks like HDFC, ICICI, Axis And Kotak Mahindra Bank among others are authorized to provide this facility. You need to submit the duly filled application form along with the required documents i.e. the KYC documents like identity proof, address proof, and signature proof. Post submitting these documents you can deposit a prescribed amount towards the opening of the account.
4. How to withdrawal our money from our PPF Account?
As a rule, one can close a PPF account only upon maturity And after the completion of 15 years. Upon completion of 15 years, the entire amount standing to the credit of an account holder in the PPF account along with the accrued interest can be withdrawn freely and the account can be closed.
However, if account holders are in need of funds, and wish to withdraw before 15 years, the scheme permits partial withdrawals from year 4 i.e. on completing 3 years.
Steps for withdrawal from PPF Account:-
In case you wish to partially or completely withdraw the balance in your PPF account, you can do by submitting an application whereve you have open your account for withdrawal in Form C with the concerned branch of the bank where your PPF account lies. And also these form are available from online
It is also mandatory to enclose a copy of the PPF passbook along with this application.
5. The tax benefits of investing in PPF Account?
PPF is one investment vehicle that falls under the Exempt-Exempt-Exempt (EEE) category. This, in other words, means that all deposits made in the PPF are deductible under section 80C of the Income Tax Act. Furthermore, the accumulated amount and interest is also be exempt from tax at the time of withdrawal.
It is important to note that a PPF account cannot be closed before maturity. A PPF account, however, you can be transferred from one point of designation to the other.
6. Feature of Opening PPF Account?
The Public Provident Fund is a savings-cum-tax-saving
The Public Provident Fund is a savings-cum-tax-saving
instrument in india. introduced by the National Savings Institute of the Ministry of Finance in 1968. The aim of the scheme is to mobilize small savings by offering an investment with reasonable returns with income tax benefits and some points:-
- The rate of interest at present is 7.9% pA (as of July 2019).
- The given interest is compounding yearly.
- Interest received is tax free.
- The maximum amount which can be deposited every year is ₹150,000 in an account at present.
- All the balance that accumulates over time is exempted from wealth tax.
- The minimum amount is ₹500 which can be deposited
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