PPF Accounts refers to Public Provident Fund Account.This is long term scheme by Govt of India in which regular interest is paid. Any Individual can open account in PPF in his own name or on behalf of minor for whom he is a guardian and HUF. The interest paid against PPF account is tax free. PPF account can be open in any Post Office and some authorized banks like- SBI,ICICI etc. As per the PPF scheme framed by Govt. of India the Max amount that can be deposited in PPF account every year is 1,00,000 rupees and minimum amount that can be deposited every year is 500 rupees. If PPF account holder does not deposit rs 500 every year in his/her account,A penalty of 50 rs each year would be levied along with the arrears of subscription of rs 500 for each year. The PPF interest Rate is decided by the Govt of India. Govt had decided interest rate of 8.8% w.e.f. 1st April 2012. The PPF account can be closed at any time after completion of 15 years from the date on which it was opened.
There is a locking period of 5 years for PPF account and and account holder can only withdraw money at the end of 5th year. The maximum amount that can be withdrawn is 50% of the amount stood in his account at the end of previous year. The investment made in PPF account is eligible for deduction under 80C.
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Wednesday, January 30, 2013
What is PPF or Public Provident Fund Account in India and What is the use of PPF
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