Public Provident Fund is the most popular investment option in India as it is a safe investment product with guaranteed returns. It was introduced in 1968 and has been famous since then. In this scheme, you contribute small amounts for a period of 15 years and then get reasonable returns. There are also tax benefits associated with PPF. The minimum amount to be deposited is Rs 500 while the maximum that can be deposited is Rs 1.5 Lakh. A parent or guardian can open a PPF account in the name of a minor child. One would assume that he knows everything or most things about PPF. But just to inform you, here are some lesser known facts about PPF. India’s First Free Online Financial Advisory Moneymindz
1. Determination of the maturity date
If you are confused or know someone who is confused about the maturity date of PPF, here is something for you to know. The maturity date isn’t calculated from the date the account is opened. Online Financial Advisory, Kuber Mindz. Keeping in mind PPF norms, the maturity date is determined from the end of the financial year in which the initial deposit was made. The lock-in period is fifteen years. So, if you open a PPF account today, the maturity period will be calculated from March 31st 2019 and the lock-in period will be there till 2033.
2. Ownership of PPF
Individual who is an Indian can own a PPF. A PPF account cannot be co-owned with the only exemption of a minor. A parent or guardian can open a PPF account in the name of the child. A grandparent can open a PPF account for the4 child only in extreme cases like the death of both parents. One person cannot open more than one PPF account. An account in the name of a minor will be treated as a separate account. NRIs cannot open separate accounts but can continue their existing PPF account till maturity. Joint Families and a body of individuals cannot open PPF accounts too. India’s First Free On call Financial Advisory Moneymindz
3. Loans and partial withdrawals during the tenure
PPF has got a lock-in period of 15 years but it allows you to withdraw funds partially. But this is subject to the PPF balance and the number of years completed. You can also take loans from PPF account, which is again subject to certain conditions like PPF balance and number of years.
PPF comes under the EEE (Exempt, Exempt, Exempt) status so any withdrawals you make before the expiry of lock-in period is exempted from tax. But while filing your ITR you are supposed to mention that you have withdrawn from the PPF. Smart Financial Advisor, Kuber Mindz
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