Deposit Limit Of PPF

A person is eligible to invest in the PPF account for tenure of 15 years. After the completion of the said period, the investor up on his/her discretion can extend the investment in blocks of 5 years.

A person can initiate a PPF account with an amount as low as Rs. 100.

The amount that a person can invest in the PPF account is a minimum of Rs. 500 to a maximum of Rs. 1,50,000.

The investor has to contribute to the PPF account each year to keep it active.

The maximum limit for contributions during a particular month is two. However, the total number of contributions that a person can make in a particular year cannot be more than 12 contributions.

The investor, thus, has the option to make a lump sum contribution to the PPF account or a maximum of 12 contributions during a particular year.

In case a person fails to invest in the PPF account for a continuous period of 15 years, such PPF account will become inoperative or dormant.

A person can still earn interest on dormant accounts but the benefits available on such accounts are limited (for example, loans against such accounts are not permitted).

A person can revive such dormant account by in the following manner,

• The very first step to revive the account is to submit a written request at the issuing post office or bank branch where the account is based.
• Next, the investor has to pay the minimum yearly deposit amount of Rs.500 for each year the account has been inactive.
• Along with the above minimum yearly deposit, the investor also has to pay a fine of Rs.50 for each year the account has been inactive.
• Following the above process, the investor has to then visit the branch of PPF account once more to complete the verification process.

Eligibility Criteria for PPF

The details of eligibility for the PPF are enlisted below.

• All the residents of the country are eligible to invest or subscribe to the PPF scheme.
• A person can also invest in the scheme in his/her name or on behalf of,
• Minor
• A person of unsound mind

Parents can open a PPF account on behalf of their minor son or daughter. However, the scheme places a restriction in this regard that both the parents are not allowed to open a PPF account for the same minor child.

In the event of demise of both the parents, the Grandparents can open a PPF account on behalf of their grandchild as their guardians.

• The scheme does not permit the NRIs to invest in PPF. However, of a person who has already invested in PPF and later becomes an NRI, such person can continue to hold his/her investment in PPF till the maturity term of 15 years but is not allowed to avail the  benefit of extension of the account for blocks of 5 years each.

Documents required to open a PPF account

The documents required by an investor to avail the PPF investment are the basic KYC documents. The list of the documents required is given below.

• KYC documents to verify the identity of an individual (Aadhaar card, Voter ID, Driver’s License, etc.)
• PAN card.
• Proof of Residential address.
• Nominee Declaration Form (Form E).
• Passport sized photograph

Tax benefits of PPF

The investment in PPF is eligible for many tax benefits that make it a very attractive and lucrative investment and is thereby favored by the majority of the investors. Following are the tax benefits available on an investment in PPF.

• The investment in PPF is eligible for deduction under section 80C of the Income Tax Act, 1961 up to a maximum of Rs. 1,50,000 per financial year.
• The interest earned on the PPF investment is tax free i.e. is not taxable in the hands of the investor.
• Moreover, the PPF investment is also not subject to any wealth tax.

About PPF Deposit Limits

The Public Provident Fund is popularly known as PPF. It is a Government savings scheme that is designed to give the maximum benefits to the residents of the country and provide a safeguard or a safety net for the investors in their need of financial assistance. Investment in PPF has been a preferred option by the masses of the country for many years now. PPF has a host of features and benefits like tax benefits, better rate of interest, easy accessibility and availability and hence is a very effective tool for a better retirement plan.

An eligible person can open a PPF account with any of the post offices across the country or any of the authorized banks (nationalized banks and its branches or a few private banks and their selected branches). The scheme provides the facility to open a PPF account by physically visiting the post offices or the partner banks or through an online process available for the same. Such online facility, however, is not available with all the authorized banks as well as varies in the extent of online application available, i.e. partial online process to open a PPF account or complete online process to open a PPF account.

The current rate of interest applicable on the PPF accounts is 7.1% per annum for the period starting from 1st April 2021.

FAQs: Deposit Limit for PPF