The Public Provident Fund (PPF) is one of the most popular small savings schemes in India. It is a government-backed investment tool that offers attractive interest rates and tax benefits under the EEE scheme (Exempt-Exempt-Exempt). The PPF account is suitable for individuals seeking long-term savings with a secure return. However, there are specific PPF limit related to deposits, withdrawals, and loans that investors need to be aware of.
This guide will provide an in-depth understanding of the PPF limit, including PPF deposit limits, withdrawal limits, loan applicability, and tax exemptions.
The PPF deposit limit determines the minimum and maximum amount an individual can contribute to their PPF account in a financial year.
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PPF allows partial withdrawals under specific conditions, even though it is a long-term savings scheme.
It can avail of a loan against their PPF balance under specific conditions.
You may also want to know the EPF Payment
The Public Provident Fund (PPF) scheme is an excellent long-term savings instrument with attractive interest rates and tax benefits. However, understanding the PPF limits, including deposit limits, withdrawal limits, loan eligibility, and tax exemptions, is crucial to maximizing benefits. Investors should plan their contributions wisely to ensure they remain within the prescribed limits and make the most of this government-backed investment option.
The maximum deposit limit for a PPF account is Rs. 1.5 lakh per financial year.
Partial withdrawals are allowed from the 7th year, but full withdrawal is permitted only after 15 years.
Yes, you can take a loan between the 3rd and 6th financial year for up to 25% of the balance at the end of the 2nd financial year preceding the loan application.
No, any amount exceeding Rs. 1.5 lakh will not earn interest or qualify for tax deductions.
Yes, the PPF account can be extended in blocks of 5 years with or without additional contributions.
No, both partial and full withdrawals from a PPF account are completely tax-free.
No, NRIs cannot open a new PPF account. However, if they already have an existing account before becoming an NRI, they can continue it till maturity without extensions.
If the minimum deposit of Rs. 500 per year is not maintained, the PPF account will become inactive, and a penalty fee of Rs. 50 per year will be charged to reactivate it.
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