Who can open account
Any Indian can open a PPF account (Public Provident Fund Account). It can also be opened in the name of a minor. PPF account cannot be opened in joint but a nominee can be made for it. No person can open more than one PPF account in his name, whether in the post office or in the bank.
Minimum and maximum deposit
PPF account can be opened in bank and post office. A minimum investment of Rs 500 and a maximum of Rs 1.5 lakh can be made in PPF within a financial year. The maturity period of PPF is 15 years. The account cannot be closed before the maturity period is over but it can happen under certain circumstances. After the amendments in the PPF rules in 2016, PPF account can be closed prematurely for needs like treatment of critical illness, higher education of children etc.
Beneficial in terms of tax
PPF account also provides better tax saving due to EEE status. The EEE status means that the deposits made in PPF, the interest earned and the money received on completion of the maturity period are exempted from tax on all three. Apart from this, customers can transfer PPF account from existing bank or post office to any other branch of the same bank, to any other bank, from one branch of post office to another branch, from bank to post office or from post office to bank. Your PPF account will be considered active even after transfer.
Can be closed even before maturity
In case of life-threatening illness of the PPF account holder, spouse or dependent children, the entire amount of PPF can be withdrawn. Apart from this, PPF account can also be closed before maturity in case of higher education of the account holder or dependent children, in case of change of residence status of the account holder (ie became NRI). PPF account can be closed after completion of 5 years of opening. On doing so 1% interest will be deducted from the date of account opening/extension date to the date of closure of the account.
If the account holder dies
In the event of the death of the PPF account holder before the maturity of the account, the nominee can withdraw the entire amount of the PPF account, even if the PPF account has not been opened for 5 years. After the death of the account holder, the Public Provident Fund account will be closed and the nominee/legal heir will not be allowed to continue the PPF account any further.
These facilities are also available on PPF
Nomination facility is available on Post Office PPF, facility to open second PPF account in the name of the minor, loan facility, online deposit facility through intra-operable netbanking/mobile banking, online deposit facility from India Post Payments Bank Savings Account. Post office PPF account can be extended in blocks of 5 years after the completion of the maturity period of PPM. When the account is extended, it can be continued with or without fresh deposits. Interest will continue to accrue on the existing balance.
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