PPF Money Withdrawal: Everything You Need to Know
Public Provident Fund (PPF) is one of the most popular small saving schemes in India. By depositing money in PPF, you can not only earn better returns but also avail tax exemption under section 80C of income tax. Here’s everything you need to know about PPF and how you can withdraw money from it.
Who can invest in PPF?
Almost all government and private banks in the country, including post offices, offer the facility to open a PPF account. To open a PPF account, you need to be an Indian citizen. You can also open a PPF account in the name of your minor child, but you need to be their parent. Earnings from the child’s account are clubbed with the parent’s income.
How much can you invest in PPF?
You can invest a minimum of Rs 500 annually and a maximum of Rs 1.5 lakh in a PPF account. The current interest rate on PPF is 7.1 percent per annum. The locking period of a PPF account is 15 years. However, you can withdraw money from your PPF account during any emergency before the completion of 15 years.
How much can you withdraw from PPF?
Partial withdrawal from your PPF account is allowed only after seven years. You can withdraw up to 50 percent of the amount from your account, but only once in a year. The amount withdrawn will be subject to income tax. You can withdraw 50 percent of the current amount in your account at the end of the financial year before the current year or 50 percent of the current amount in your account at the end of the fourth financial year before the current year.
How to withdraw money from PPF?
To withdraw money from your PPF account, you need to submit Form C, which is available at your bank or post office. You need to mention your account number and the amount you want to withdraw in the form. Additionally, a revenue stamp will also be required. Once the process is complete, the amount will be transferred to your account.
PPF is a better option for long-term investment. After operating the PPF account for three years, you can take a loan on it. The loan facility is available from the third year to the sixth year of account opening.
Investing in PPF can help you secure your future financially. With the option to withdraw money during emergencies and avail tax exemption, PPF is indeed a popular small savings scheme in India.
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