Public Provident Fund (PPF) withdrawal is possible fully or partially with some terms and conditions. PPF is a 15 year small Saving Scheme introduced by the Ministry of Finance.
PPF investment gives tax benefit under section 80C.
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PPF Withdrawal Rules 2023-24
You can make a PPF withdrawal after completion of 15 years however you can withdraw your money partially after 5 years from the account opening time under special circumstances.
Public Provident Fund (PPF) is a Central Government of India Saving Scheme. PPF is a safe tax deductible investment option with attractive Returns.Public Provident Fund is specially popular for it’s safe,secure attractive returns.
A PPF account is a 15 year investment scheme. You cannot withdraw money before completion of 15 years. You are eligible to take a loan or withdraw money partially from your PPF account.
Read more for PPF Features
The current interest rate on PPF is 7.1 % per annum. This interest rate is compounded annually and paid on March 31st.
Public Provident Fund (PPF)-Features And Benefits || PPF Account Benefits 2022
Loan from PPF Account
You can take loan From PPF investments from 3rd financial year to 6th financial year of opening the account.
Conditions to take loan from PPF Account
#Only active account are eligible to take loan
.# You can take a loan of 25% of the account balance at the end of the second financial year immediately preceding the year in which the loan is applied for.
# You should repay the loan principal amount within three years.( three years from the first day of the month following the month in which the loan is sanctioned ).
#Loan repayment can be made in one lump sum or in a maximum of 36 monthly instalments.
#The principal amount is paid then the loan interest needs to be returned within two monthly instalments. The interest of 1% per annum is charged about the PPF interest.
What if you do not pay loan principal amount in time
If the loan principal amount is partly paid or not paid within 3 years then the outstanding loan principal amount will be charged at 6% per annum above the applicable PPF interest rate.
PPF Withdrawal Rules 2020
PPF withdrawal possible after the expiry of 5 years from the end of the year in which the account was opened.
Let’s say if you opened the account in September 2017 then you will be able to withdraw From April 2023.
PPF withdrawal amount is kept at 50% of accumulated Corpus in the fund at the end of 4th year from the date of account opening.
What happens after completion of 15 years
After completion of 15 year you have the option to opt for
| Close the PPF | Extend PPF account with Contribution | Extend PPF account without Contribution |
| Close the PPF account and withdraw entire amount | Extend PPF account for a block of 5 Year and contribute regularly | Extend PPF account for a block of 5 year and do not contribute any amount |
What are PPF withdrawal rules 2020 on extension
You can choose to extend your PPF account for as long as you want to. You can extend the PPF account for a block of 5 years.
IF you do not take any action after completion of 15 year then your PPF account is extended automatically.
In case of automatic extension, your PPF investment continues to get interest as usual.
You can make one PPF withdrawal per year after the extension.
PPF account extension with additional contribution
You can also choose to extend PPF Account with additional contributions each year to increase your corpus and to get tax deduction U/S 80 C.
You have to submit form H to extend your PPF account with contribution within a year of original date of maturity of your account.
if you fail to submit form H then your PPF scheme will be extended without contribution
If you deposit money in such an account then your contributions will not get any interest and tax benefit under section 80C.
PPF withdrawal form
If you want to withdraw partially or completely from your public provident fund then you have to submit form C with the concerned branch of the bank where you opened the PPF account.
The form has three sections
1.Declaration Section
- submit your PPF account number
- amount of money you want to withdraw
- number of years passed since account was opened
2.Office use section
3.Bank details section This section ask for the details of the bank where your money is to be credited directly or name of the bank in which you want your money back.
It is mandatory to enclose a copy of the PPF passbook along with this application
PPF withdrawal form is available for download from the website of respective Bank
Tax implications on PPF withdrawal
The withdrawal from PPF is exempt from Tax under section 80c of Income Tax Act 1961.
Public provident Fund/ PPF gives you triple E advantage that is whatever contribution you are making get tax deduction under 80C ,the interest is also exempt from tax and maturity is also tax free in nature.
Premature closure of PPF account
Pre mature closure of PPF investment is allowed after 5 year from the end of the year in which the account was opened subject to the following conditions:
- in case of threatening disease of account holder, spouse or dependent children
- Higher Education of account holder or dependent children
- If your Residency status changes, that is if you become a permanent resident of another country. In such case you can submit a copy of Passport and Visa or income tax returns for this matter.
Online Payment in your PPF Account
Online payment in your PPF account is possible through IPPB saving account and you can also deposit money online through net banking/ mobile banking.
Read more about it https://bestinvestindia.com/how-to-make-online-payment-of-ppfssa-post-office-savings/
