Start Investing with Just ₹500 – Earn Strong Interest Along with Tax-Free Returns

Post Office PPF Scheme: The Public Provident Fund (PPF) is a trusted government savings scheme known for its safe investment, fixed returns, and tax exemptions. The government wants as many people as possible to join this scheme, so almost every post office in the country offers the facility to open a PPF account. A PPF account opened at a post office is similar to a bank PPF account in terms of rules and benefits. Here, we will explain in simple terms what Post Office PPF is, its benefits, and how to open an account.

What is Post Office PPF?

Post Office PPF is a long-term savings scheme run by the Government of India. This scheme is specifically for those who want to save tax while making a safe investment. It has a fixed tenure of 15 years, which can be extended in 5-year blocks after maturity. The amount deposited in PPF, the interest earned on it, and the full amount received upon maturity are all tax-free. This makes this scheme very popular for tax planning.

Features of the Post Office PPF Account

A minimum of Rs. 500 and a maximum of Rs. 1.5 lakh can be deposited into a PPF account every year. If the minimum amount is not deposited in any year, a penalty is required to reactivate the account. Investments in the PPF scheme are tax-exempt under Section 80C of the Income Tax Act. There is also no tax on the interest and maturity amount. Partial withdrawals are available after seven years of account opening, allowing for the withdrawal of some funds if needed.

Loans are also available between the third and sixth years of account opening. The loan amount is determined based on the previous year’s balance and is limited. The interest rate on PPF is determined by the government and may change from time to time. Currently, the interest rate is 7.1 percent per annum.

How to Open a PPF Account at a Post Office

Opening a PPF account at a Post Office is quite easy. You can visit your nearest post office or download the PPF application form online. After filling in the required information, you must submit identity and address documents. A minimum deposit of Rs. 500 is required when opening an account. Upon completion of the process, you will be issued a PPF passbook, which contains a complete record of your investments and interest.

Required Documents for a PPF Account

To open an account, you must provide one of the following: Aadhaar card, voter ID, passport, or driving license as proof of identity. Any one of these documents is also valid for proof of address. Additionally, a PPF card, passport-size photo, and a nomination form are required.

Who Can Open a PPF Account

Any citizen residing in India can open a PPF account. Only one PPF account can be opened in the name of an individual, and joint accounts are not permitted. A parent or guardian can also open a PPF account in the name of a minor child. Those living abroad cannot open a new PPF account, but they can continue to maintain an existing account until maturity.