PPF Account: Benefits, Interest Rate & Withdrawal Rules

What is PPF?

The Public Provident Fund (PPF) is a long-term savings scheme backed by the Government of India. It currently offers 7.1% per annum (compounded annually, revised quarterly), with the entire corpus (principal + interest) completely tax-free.

Key Features

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The EEE Tax Status

PPF enjoys EEE (Exempt-Exempt-Exempt) tax status:

1. Investment: 80C deduction up to ₹1.5 lakh

2. Interest: Fully exempt from tax

3. Maturity: Entire corpus exempt from tax

This makes PPF one of the most tax-efficient instruments for risk-averse investors.

Withdrawal Rules

Full withdrawal only after 15-year maturity

Partial withdrawal allowed from the 7th year onwards (up to 50% of balance at end of 4th year preceding)

Premature closure allowed after 5 years in specific cases (serious illness, higher education, NRI status change)

Loans available from 3rd to 6th year (up to 25% of balance at end of 2nd preceding year)

How to Maximise PPF Returns

1. Deposit early in the financial year — invest in April (not March) to earn 12 months of interest

2. Always invest the maximum ₹1.5 lakh to fully utilise 80C and maximise compounding

3. Extend beyond 15 years in 5-year blocks — the longer you stay, the more compounding works in your favour

Calculate your PPF corpus with the PPF Calculator.