Invest 1.5Lakh/yr in PPF Scheme and get 46 lakh. Save Tax too!

Government Policies, PF, Save Tax Tips, Savings

44 Comments

Public Provident Fund (PPF) is safe investment option with attractive interest rate of 8% per Annum. You can invest a minimum of Rs 500 and Maximum of 1.5 Lakh/yr in PFF account.




Public Provident Fund (PPF): If you wish to double of your investment and save income tax as well on the money you are earnings? This seems to be a invested trick but what if PPF scheme is Government PPF scheme. PPF currently offer 8% interest rates. It is one of the safest investment Option available with high returns and Tax Benefits. PPF was Introduced by  National Savings Organization in 1968 to start small savings in 1968, the PPF currently offers 8% interest rate. You can invest a minimum of Rs 500 and a maximum up to Rs 1.5 lakh/year in a PPF account. Investment can be done in installment, maximum 12 per year or as a lumpsum.  The duration of PPF scheme is 15 years. On request of the subscriber, the account can be extended for 1 year or more blocks of 5 years each.

PPF calculation on Invest returns: Below is what you can expect to get as a return on your investment after the completion of the 15-year maturity period.

Suppose you are investing Rs 1.5 Lakh/year for next 15 years. The Total Investment you will be doing during this duration would be Just 22.5 Lakh. At the maturity you will get Rs 46 Lakhs

Similarly suppose, for an investment of Rs 1 Lakh/year, you can get around Rs 31 lakh on your total investment of Rs 15 Lakh in 15 years.

By investing Rs 50,000/year, you can get around Rs 15 lakh (Your total investment would be just Rs 750,000). By investing a small amount of Rs 5000/month, you can get around Rs 18 lakh after 15 years.



You can use free PPF calculator and make an approximate calculation of the return on PPF investment. The PPF interest rate can change slightly over a period of time. The government determines the rate of interest on a quarterly basis.

Tax benefits: Under Section 88 of IT Act, income tax benefits apply for the investment and interest income from PPF account. The amount outstanding to the credit is fully exempted from Wealth Tax also. Moreover, the PPF comes with loan benefits depending upon the age of the account and balances as on the specified dates. You can not  close PPF account before 15 years. But you can withdraw you PPF partially after 7th Year.

Where to open PPF account? 

You can open a PPF account with your bank as well as the Post Office. Check their websites for more details before investing. When you login into your Net Banking, Every Bank website will show you option to Open PPF account Online.

Below is PPF calculation yearly at 7.6% interest rates.

YearOpening BalanceAmount DepositedInterest EarnedClosing BalanceLoan (Max.)Withdrawal (Max.)
1 0 150000 11400 161400 0 0
2 161400 150000 23666 335066 0 0
3 335066 150000 36865 521931 40350 0
4 521931 150000 51067 722998 83767 0
5 722998 150000 66348 939346 130483 0
6 939346 150000 82790 1172136 180750 0
7 1172136 150000 100482 1422618 0 260966
8 1422618 150000 119519 1692137 0 361499
9 1692137 150000 140002 1982139 0 469673
10 1982139 150000 162043 2294182 0 586068
11 2294182 150000 185758 2629940 0 711309
12 2629940 150000 211275 2991215 0 846069
13 2991215 150000 238732 3379947 0 991070
14 3379947 150000 268276 3798223 0 1147091
15 3798223 150000 300065 4248288 0 1314970



Let us know what do you think about this investment Scheme in comment section. If you wish us to write an article on other article do let us know in comments below.

Also Read : Housing for All by 2022 – It’s Pradhan Mantri Awas Yojana (PMAY)

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44 Responses to “Invest 1.5Lakh/yr in PPF Scheme and get 46 lakh. Save Tax too!”

  • Saju George October 26, 20187:22 pm

    PPF is an excellent investment for the young especially.Our national economy is doing quite well now.Ours now is one of the best growing economies namely fifth, in the World. The investor is gaining, the Government is gaining and it is a win win situation for both. Saju George.

    Reply
  • yogeshbaijal October 21, 201812:50 pm

    Excellent information regarding PPF a/c has been given. Really it is double benefit saving scheme . In my opinion Govt. must increase the limit 1.5 Lakhs to to 2 Lakh yearly

    Reply
  • P S Gangadhara Gowda October 21, 201810:35 am

    whether we can short close the account in case of emergency or we have to wait till the completion of 15 years foe getting full amount.

    Reply
  • P S Gangadhara Gowda October 21, 201810:33 am

    is there any age limit for investing in PPF Account. or anybody can anytime open an account.

    Reply
  • JN October 15, 20188:23 pm

    Madam/Sir,

    1. If private sector (non govt) employee, whose certain amount (i.e 4000/- PM or 48000/- annually) is getting deducted for PF. can he open PPF A/C for 102000/- (1.5 lakh – 48000/-) or how much (maximum) he can invest in PPF A/C for tax saving purpose as well as investment with good return both.

    2. Pls also infom when any PPF A/C holder having 01 or 02 years gap during changing / new job. is it compulsory to deposit or he can left for 01 or 02 years and he can resume then.

    Please reply thru e-mail.

    Thanks & regards.

    Reply
    • KSRAO October 18, 20187:49 am

      Can I withdraw the amounts in full in a time gap of 4-5 years. If so any penalty?

      Reply
    • Sameer October 29, 201811:37 am

      Sir,
      PPF scheme is an exclusive scheme, it is separate from the PF that is being operated by your company and the money is deposited with the PF trust. So even if you are getting deducted for Rs.48k per annum, you still can deposit Rs.15 Lacs per annum in PPF account as the 2 accounts are separate.

      It is compulsory to deposit amount in PPF account every year, you have a flexibility of depositing Rs.500 to Rs.1.5 lacs every year. So in case of any financial difficulty, you may reduce your deposit amount.

      Hope that calrifies

      Reply
  • suresh.p October 12, 201811:57 am

    where we have to open ppf account

    Reply
  • kalpana Deshpande October 12, 201811:14 am

    Can a retired person invest in PPF for Income tax benefit?

    Reply
    • kashiram Vithal Kadam October 15, 201812:19 am

      I m interested in PPF

      Reply
  • Ashok Kumar October 11, 20181:34 pm

    I will be retiring in July 2019. Will it be possible to withdraw full amount from my ppf account opened in dec. 1995. If , not full; how much I can withdraw at the time of retirement. Kindly inform. My ppf account is valid up to March 2021.

    Reply
  • Koreth October 9, 20182:46 pm

    Yes.. Notify me with financial updates

    Reply
  • Karan Singh October 6, 20183:53 pm

    As per the schedule shown after 15 Years will get 42 L. But above shown 46 L after 15 years. How it is ??? plz explain.

    Reply
  • R K Arora October 5, 20187:38 pm

    Whether NRE Indian origin can open PPF a/c for investment purpose who do not require tax benefits

    Reply
    • R K Arora October 21, 201811:02 pm

      Whether NRE can open PPF account

      Reply
  • Suchit October 5, 20188:40 am

    Same amount should be deposited every time or any amount within 1.5lakh can be accepted?

    Reply
    • Sudhakara Mahapatro October 5, 20187:29 pm

      Keeping in view as to how much you can invest in a year, you will have to fix the amount to be deposited monthly. You can, however, reduce or increase the monthly deposit, subject to the maximum deposit of Rs.1.5 lakh/year.

      Reply
    • Sameer October 29, 201811:41 am

      The maximum amount is Rs.1.5 lacs and the minimum amount is Rs.500 per annum. The entire amount per annum has to be paid in a maximum of 12 installments only or can be paid off in 1 installment too.

      Reply
  • Zahoor October 4, 20182:06 pm

    If I invest randomly many like 1 lac or 0.5 lac in one year that too in different months like January month, August months then how much interest I will get at maturity.

    Reply
  • Rajendar Kumar Jain October 4, 20182:05 pm

    I had extension for 5 years in 2016. Can I extend my account for another 5 years in 2021.

    Reply
  • shrirang October 4, 201811:53 am

    If any mishap happened with account holder before maturity of the account. What amount can be received to the Nominee, entire maturity amount or only deposited amount with interest. Please confirm.

    Reply
    • KAMAL October 5, 20189:42 am

      I THINK HE WILL GET ONLY DEPOSIT AMOUNT WITH INTEREST EARNED. (NOT SURE) NO ANY OTHER FUND WILL GOT IN THAT CASE. ITS JUST LIKE A FDR/TDR OR RECURRING DEPOSIT SCHEME.

      Reply
  • vachaspati Trivedi October 4, 201810:23 am

    Excellent information & most beneficial for future living life !!

    Reply
  • Bimal Behera October 4, 20189:48 am

    Suppose from my salary a certain amount is getting deducted for PF and after some time I left my job(lets say for 1 year) and again join a new job after 1 year. So for that 1 year gap no amount was deposited in PF account. So my question is : what ever amount has been deposited in PF account before that year gap will that 8% of interest be calculated to the amount ?

    N.B : I did not withdraw a single rupee from the PF account ever.

    Reply
  • ANUP TALWAR October 4, 20186:07 am

    Sir/Madam,

    Thanks for excellent information,please share detailed information on Capital gain 1.On property,2.On Shares & Mutual funds (Long term & Short term) 3 On gold. Ways to save maximum on NCD’s ? Ways to save maximum on tax for the persons who are retired but their age is less than 60? Ways to save maximum tax for the persons more than 80 years of age ?

    Waiting for your valuable guidelines.

    Regards,

    Anup Talwar
    9988014381

    Reply
  • m.a.rao October 3, 20188:24 pm

    AS A DEVELOPING NATION THE SAVING CULTURE HELPS FOR ANY INDIVIDUALS . . I SUGGEST TO HAVE SAVINGS FOR 20 YEARS , 25 YEARS , 30 YEARS ETC SO THAT ONE CAN USE IT FOR HOUSING ,MEDICALS ETC

    Reply
  • gyan bansal October 3, 20186:29 pm

    what are other options for better returns.

    Reply
  • Pradipta saha October 3, 20184:44 pm

    If i continued my PPF after 15 years for 5/10 years more & investing Rs. 150000 per year what it will fetch in maturity.

    Reply
    • Aijaz Ahmad Rangrez October 4, 20188:34 am

      I want to invest in ppf scheme what will I do.

      Reply
  • RAJENDRA VITTHAL ISHI October 3, 20184:15 pm

    Very nice article great information thanks thanks thanks

    Reply
  • rajendra singh October 3, 20182:34 pm

    how much we can minimum spent in ppf.

    Reply
    • DIPESH PARMAR October 11, 20187:53 pm

      You can invest minimum 500 in a year.

      Reply
  • ankush October 3, 201810:18 am

    Is it opened only to salary class only or others could also avail the option please.?
    Regards

    Reply
  • romy sharma October 3, 201810:02 am

    what happens if the party dies say on 5th yr /before term gets over.

    Reply
  • Ramamurthy October 3, 20188:50 am

    as per the schedule shown only 42 L. What about 46 L after 15 years.

    Reply
    • Karan Singh October 6, 20183:45 pm

      My question is same as Mr. Ramamurthy asked, as per the schedule shown only 42 L. What about 46 L after 15 years ???

      Reply
    • K.SURESH October 24, 20181:25 am

      I think 46 Lakhs has been arrived at after adopting interest rate at 8% yearly prevailing then. Hence 42 Lakhs is shown by adopting annual interest yield at 7.60%. It is also said that Govt.revises the interest rate periodically on PPF deposit by notification. Hence, the difference in the maturity amount.

      Reply
  • Anthony F coutinho October 3, 20188:38 am

    Why is the PPF calculation shown at 7.6% interest rate ?

    Reply
  • Dr B M Gupta October 2, 20188:29 pm

    Excellent and safe investment

    Reply
  • Bajrang October 2, 20185:40 pm

    If i don’t take any money 7th to 10th year

    Reply
    • VISHWAS BHAVE October 3, 201811:44 am

      In that case you may withdraw Rs 711309/-, in the 11th year. Which was 50% of the minimum amount you had in your account between 8th and 10th year.
      If you withdraw anything between 7th and 10th year, permissible withdrawal in the 11th year will be much lower.

      Reply
      • Syed Sajid Akhtar October 4, 20187:40 am

        I want 7-10 years investment for return.

        Reply
  • Bajrang October 2, 20185:39 pm

    If i don’t take any money 7th to 10th year

    Reply
  • Shakeel ahamad October 2, 20188:26 am

    Hdvdj

    Reply

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