Calculate Your PPF Returns
Current PPF Rate: 7.1% per annum (compounded annually). Rate is set by Government of India and reviewed quarterly.
💡Pro Tips
- ✓Invest before 5th of month for full month interest
- ✓Max ₹1.5L/year for 80C tax deduction
- ✓EEE status - completely tax-free
Maturity Summary
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What is Public Provident Fund (PPF)?
Public Provident Fund (PPF) is a long-term savings scheme backed by the Government of India. It offers attractive interest rates with complete tax benefits under the EEE (Exempt-Exempt-Exempt) category. PPF is one of the safest investment options in India, ideal for building a retirement corpus or achieving long-term financial goals.
With a lock-in period of 15 years (extendable in blocks of 5 years), PPF encourages disciplined savings while providing guaranteed returns. The scheme is available at all post offices and authorized banks across India, making it easily accessible to every Indian citizen.
How Does PPF Calculator Work?
Our PPF calculator uses the compound interest formula to calculate your maturity amount. The formula is:
F = P × [((1 + i)^n - 1) / i]F = Maturity amount
P = Yearly investment amount
i = Interest rate (7.1% = 0.071)
n = Number of years
Interest is compounded annually and credited to your account at the end of each financial year. Deposits made before the 5th of any month earn interest for that entire month.
Benefits of PPF Investment
Government Backed
100% safe investment backed by Government of India. No market risk, guaranteed returns.
EEE Tax Benefits
Investment, interest, and maturity amount all are completely tax-free under Section 80C.
Attractive Returns
Current rate of 7.1% p.a. compounded annually, higher than most fixed deposits.
Flexible Deposits
Deposit in lump sum or installments. Make up to 12 deposits per year at your convenience.
Loan Facility
Avail loans from 3rd to 6th year at just 2% above PPF interest rate.
Minor Account
Open PPF account for minors. Great way to build wealth for your children's future.
PPF Rules & Regulations
Investment Limits
Minimum: ₹500 per year | Maximum: ₹1,50,000 per year
Lock-in Period
15 years from the end of financial year in which account was opened. Extendable in blocks of 5 years.
Interest Rate
Currently 7.1% p.a. (reviewed quarterly by Government). Compounded annually.
Account Opening
Available at post offices and authorized banks. Can be opened by individuals and minors (through guardian).
PPF Tax Benefits - EEE Status
PPF enjoys the rare EEE (Exempt-Exempt-Exempt) tax status, making it one of the best tax-saving investments in India:
Investment is Exempt (Section 80C)
Investments up to ₹1.5 lakh per year qualify for tax deduction under Section 80C. Save up to ₹46,800 in taxes (at 30% tax bracket).
Interest is Exempt
All interest earned on your PPF account is completely tax-free. No TDS deducted, no tax liability.
Maturity Amount is Exempt
The entire maturity amount (principal + interest) is tax-free. No tax on withdrawal at maturity or extension.
PPF Withdrawal Rules
Partial Withdrawal
Allowed from 7th financial year onwards:
- Maximum: 50% of balance at end of 4th preceding year
- Only one withdrawal per financial year
- Completely tax-free
Premature Closure
Allowed after 5 years in specific cases:
- Life-threatening disease of self, spouse, or dependent children
- Higher education of account holder or children
- Change in residency status (NRI)
- Interest rate reduced by 1% on premature closure
Maturity
After 15 years, you can withdraw the entire amount or extend the account in blocks of 5 years (with or without contributions).
Frequently Asked Questions (FAQs)
What is the current PPF interest rate?
The current PPF interest rate is 7.1% per annum (as of 2024), compounded annually. The rate is reviewed quarterly by the Government of India and is linked to government securities yields.
Can I have multiple PPF accounts?
No, an individual can have only one PPF account in their name. However, you can open a separate account for your minor child. Multiple accounts opened after December 2019 will be closed, and only the first account will remain active.
What happens if I don't deposit the minimum amount?
If you don't deposit the minimum ₹500 in a financial year, your account becomes inactive. You can reactivate it by paying ₹50 penalty per year along with the minimum deposit of ₹500 for each defaulted year.
Can NRIs invest in PPF?
No, NRIs (Non-Resident Indians) cannot open new PPF accounts. However, if you opened a PPF account as a resident Indian and later became an NRI, you can continue the account until maturity without making further deposits.
How is PPF different from EPF?
PPF (Public Provident Fund) is a voluntary savings scheme open to all, while EPF (Employees' Provident Fund) is mandatory for salaried employees. PPF has a 15-year lock-in with flexible deposits, while EPF is linked to employment. Both offer tax benefits, but EPF has higher contribution limits.
Can I take a loan against my PPF account?
Yes, you can take a loan from 3rd to 6th year of account opening. The loan amount is limited to 25% of the balance at the end of 2nd preceding year. Interest rate is 2% above the PPF rate. The loan must be repaid within 36 months.
What is the best time to deposit in PPF?
Deposit before the 5th of any month to earn interest for that entire month. For maximum returns, deposit the full ₹1.5 lakh at the beginning of the financial year (April). This way, you earn interest on the entire amount for the full year.
Is PPF better than Fixed Deposit?
PPF is generally better than FD for long-term savings because: (1) Tax-free returns - PPF offers EEE status while FD interest is taxable, (2) Higher effective returns - After tax, PPF gives better returns, (3) Government backing - PPF is 100% safe. However, FDs offer more liquidity and shorter lock-in periods.
PPF Investment Best Practices
1. Start Early for Maximum Compounding
The power of compounding works best over long periods. Starting PPF in your 20s or 30s can create a substantial retirement corpus. Even with minimum deposits, starting early makes a huge difference.
2. Maximize Annual Contribution
Try to invest the maximum ₹1.5 lakh per year to get full tax benefits under Section 80C and maximize your returns. If not possible initially, gradually increase your contribution each year.
3. Deposit Early in the Month
Always deposit before the 5th of the month to earn interest for that entire month. Depositing on the 6th means you lose a whole month's interest. For maximum returns, deposit the annual amount in April itself.
4. Extend After Maturity
After 15 years, consider extending your PPF account in blocks of 5 years. You can continue earning tax-free interest even without making further deposits. This is especially useful if you don't need the money immediately.
5. Open Account for Children
Open a PPF account for your minor children. By the time they turn 18, they'll have a substantial corpus for higher education or other goals. It's a great way to teach them about disciplined savings.
6. Avoid Premature Withdrawal
While partial withdrawals are allowed from the 7th year, avoid them unless absolutely necessary. Every withdrawal reduces your corpus and the compounding effect. Let your money grow for the full 15 years.
7. Combine with Other Investments
PPF should be part of a diversified portfolio. Combine it with equity mutual funds for higher growth potential, while PPF provides stability and guaranteed returns. Don't put all your savings in PPF alone.
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PPF is one of the safest and most tax-efficient investment options in India. Use our calculator to plan your investments and build a secure financial future.
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