PPF withdrawal rules and procedure..
Savings schemes are still used the most by the public. As such, Public Provident Fund is one of the most popular retirement savings schemes. Every year lakhs of people invest in this scheme. Almost anyone can invest in this government-backed scheme with an annual contribution of a minimum of Rs 500 and a maximum of Rs 1,50,000.
1. What are the necessary rules?
Your PPF contribution earned interest and maturity amount is exempt from tax under section 80C of the IT Act. PPF currently offers an interest rate of 7.1 percent per annum. This is one of the highest interest rates among risk-free savings schemes after EPF. PPF account holders can also take a loan on their account at only 1% annual interest under certain conditions.
2. Have to wait for 5 years
The maturity of a PPF account is 15 years, but you can withdraw the amount even earlier.
3. How Maths Will Work?
The year of account opening is not included in the calculation method for five years. That is, if you open an account in 2022, you will have to wait for 2028, not 2027. As per the guidelines of india Post, the investor can avail of this withdrawal only once after 5 years.
4. Will not get the full amount
Also, you cannot withdraw the entire amount in your account before 15 years. This means that you can withdraw the amount anytime between 5 to 14 years but you will not get 100% of the amount present in the account at that time.
5. No tax is levied
Up to 50 percent of the account amount can be withdrawn in the fifth year and it is a tax-free system.
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