PPF is the long term saving scheme introduced by ministry of finance in 1968. the purpose of the ppf is to mobilize the small savings of the individual by offering them investments that carry a reasonable return along with the income tax benefits
it is a tax saving instrument on which regular interest is paid. deposits in PPF can be claimed for tax deductions and also the interest received in PPF is tax free.
For simplification and to understand more about ppf you can see the video as well.
it is a tax saving instrument on which regular interest is paid. deposits in PPF can be claimed for tax deductions and also the interest received in PPF is tax free.
FEATURES
- Deposits can be made in lump-sum or in 12 installments.
- Joint account cannot be opened.
- Account can be opened by cash/cheque and in case of cheque, the date of realization of cheque in government account shall be date of opening of account.
- Nomination facility is available at the time of opening and also after opening of account.
- The subscriber can open the another account in the name of minors but subject to maximum investment limit by adding balance in all account.
- Maturity period is 15 years but the same can be extended within one year of maturity for further five years and so on.
- Maturity period can be retained without extension and without further deposits also.
- Premature closure is not allowed before 15 years.
- Deposits qualify for deductions from income under Sec. 80C of IT Act.
- Interest is completely tax free.
- Withdrawal is permissible every year from 7th financial year from the year of opening account.
- Loan facility available from 3rd financial year.
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To know about another financial instruments , click on the following link.
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