5 must know rules before Opening PPF Account for minor child

POSTED BY manish ON February 24, 2014 COMMENTS (353)

PPF account is one of the most favorite investment product in India and every person wants to open a PPF account for minor child. However, there are lots of myths about the rules on opening PPF account for minor kids.

In this article, we will look at some of the important points you should know if you want to open a PPF account for your children. We will discuss about tax exemption, limit on the amount you can invest and PPF maturity rules. Here they are

UPDATE: The limit was 1 Lac when this article was written. Now it has increased to 1.5 Lacs.

rules ppf account for minor children

1. Who can open PPF account for minor Child ?

As per PPF rules, a guardian can open Public Provident Fund account for minor child, where guardian is

  • Either Father or Mother
  • Or incase of Parents are not alive, then any other guardian under the law can open PPF account for minor children, like Uncle, Aunt, Grandmother, Grandfather etc.
  • Incase a surviving parent is incapable of acting, then also some other guardian (as mentioned above) can open PPF minor account

2. How much can I invest in PPF account of Minor Child ?

There is a very big confusion around this topic. The most common question is – “Can I invest more than 1 lac in PPF account ?”

As per my understanding and all the readings I did on this topic, I came to know that One can invest maximum of Rs 1 lac in all the combined PPF (Public Provident Fund) account a person has which is self , and for minor children. Example – Imagine there is a Father (F) and Mother (M) and there are two minor children – C1 and C2 . Now follow scenario’s are possible

  • Father (F) can open PPF account for himself, C1, and C2
  • Wife (W) can open PPF account for herself, C1 and C2
  • Father can open PPF account for himself and C1 (or C2) , Wife can open PPF account for herself and C2 (or C1)

Here are these 3 scenarios possible

PPF account for minor

3. Can I deposit more than 1 lac in PPF account even if I don’t need income tax exemption ?

This is one question which really needs clarity, because a lot of people open PPF accounts for minor children and invest Rs 1 lac in all the Public Provident Fund accounts (Here are articles on opening PPF account with ICICI Bank and with SBI Bank).

You don’t get income tax exemption under 80C for more than total Rs 1 lac, which is fine for many people, but are you eligible to get benefits on more than 1 lac invested or not ?

As per PPF rules, you are just not allowed to invest more than Rs 1 lac in your own PPF account or any other PPF account where you are guardian. So if you have 2 kids and you have opened PPF account in their names, you might be thinking that you can invest 1 lac in your own PPF and 1 lac in each kid PPF account so that you can enjoy tax free maturity income later for your kids PPF account .

But I dont think its allowed, because as per PPF rules, the 1 lac limit is for an individual , not on per account basis .

But I have been investing more than 1 lac each year, already from many years !

I know, a lot of investors who have been investing more than 1 lac in PPF each year. Due to technological challenges, it might be possible that no one stopped you from doing it, but in future if govt comes to know that you have been avoiding the rules, you might not get any interest on the excess amount, so you might get back only the principal amount at the time of maturity.

A lot of Bank staff are also not clear on these rules , here is an incident which was shared by one of our readers 

Today I met manager of the branch of bank (State Bank of India) where I have all these three accounts. I narrated the whole scenario. He does not see any problem with the situation.

I am really confused as to continue this mode of financial plan or to change it in the light of your clarification regarding the total ppf investment limit.

4. Do I need to declare about my personal PPF accounts at the time of opening minor PPF ?

A person can not have more than 1 PPF account on self name, but they can have it as a guardian for his children , but you need to declare about all your PPF (Public Provident Fund) account as self and for other children at the time of opening a new PPF account with other kids.

Because when you fill up the PPF opening form, there is a declaration you need to give about it , here is a snapshot of how it looks like

self declaration ppf form

Which means that legally you need to declare about your other PPF accounts , if you don’t do so, you are breaking the law and if in future its detected that you have been doing what is not allowed, all the money you have deposited in PPF account in excess to the limit allowed will just be returned to you without any interest, and that might be a big blow to your overall planning.

So, a small change you can do in your overall planning is that, you can ask your spouse to open PPF account as guardian for the child, this way, one husband can avail upto 1 lac benefit and wife can also avail upto 1 lac benefit.

5. What happens when the minor kid becomes a major ?

Case 1 : If PPF account matures before the child attains 18 yrs

In this case the guardian can either withdraw the money from PPF or extend it for another 5 yrs block . In this case, the money withdrawn will be treated as guardian income and now when this money is invested somewhere else and any interest income is earned (learn how PPF interest is calculated), then it will be treated as guardian income only.

So imagine PPF (Public Provident Fund) account is matured and the kid is still minor (assume you opened the PPF when he/she was 1 yr old) and you get Rs 10 lacs from PPF account, now when you invest this 10 lacs into FD , you get Rs 1 lac as interest in a year, this interest income will be treated as your income (guardian income) and will be added into income and taxed accordingly.

Case 2 : If PPF account matures after the child attains 18 yrs (become’s major) –

In this case, the account will then be operated by the child (who has become major) and there will be no guardian. The child will then take his/her own independent decision.

In this case, because the PPF account has matured after the child has attained maturity age, all the maturity amount will be income of the child itself, Now any interest income earned on this amount in future will be kid income.

Conclusion

PPF account for minor children is a good idea if you want to build a long term corpus for their education or other requirement. However if you are already exhausting your own limit for PPF (Public Provident Fund), then it might not be that useful because their a limit on the investment amount.

You need to see how you want to divide the amount between your own and your kid and whom do you want to make guardian, yourself or your spouse ?

Can you share about your case ? Do you have PPF account for your minor child ?

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353 replies on this article “5 must know rules before Opening PPF Account for minor child”

  1. mansi says:

    Dear Sir,

    I have received a lump sum amount towards full n final settlement of divorce so i want to open two ppf account one for self and other for my minor child can i do it ? if so pls exlplain in detail..THANKS IN ADVANCE.

    1. Yes, you can do it, but you cant deposit the whole amount in one go . Why are you not investing in something better?

  2. Rosita says:

    I have a daughter. We are all NRI’s. Can i open a PPF account for her?

    1. I dont think you can as of now

  3. Pravin says:

    if i open ppf account in the name of child, once child becomes major. can he still maintain ppf account in blocks of 5 yrs? if yes, for how many times it can be extended?

  4. Nitin says:

    Can I open PPF account for 7 month old baby?
    What will be the maturity period of this account ?

    1. Yes you can.

      It will still be 15 yrs from the date of opening

  5. SIVAKUMAR says:

    My friend and his wife both are Indian citizens. Their minor child was born in USA . This child is holding a US passport. . This child is now living with the parents in India . The child is having Persons of Indian Origin Card .Can the parents open a PPF account for this child.

    1. I think they can if the child is also an INDIAN CITIZEN

  6. Paras says:

    Dear Sir,

    I had opened PPF account of my minor daughter name in 2013. Now i want to change her name from old to new in the bank Passbook. I have revised birth certificate also with the new name. So how can it’s possible to update the name in my PPF account ? Please reply.

    Thanks.

    1. Jagoinvestor Admin says:

      Hi Paras

      Its simple you just visit the bank and ask them . Usually they will ask you to just submit a name change form with the Proof of Name in the Bank.

  7. sarfaraj says:

    sir I have 2 years old son I want open ppf A/C pl guide me

  8. Omprakash says:

    Sir
    My PPF account Completed 20 Year..
    1. Can I Also extend..
    2. Or Can I Open MY Grand son account..

  9. manjusha says:

    Thanks for the article.

    As per the point 5 can I conclude that it’s good to open PPF account on child’s name only when she/he attains 3+ years of age. So, that the matured amount can be invested in child’s name and tax can be avoided ( considering child will not earn at the age of 18 years) .

    If yes, I am little confused whether it’s 2+ year or 3+year. Please correct me.

    1. Anyways PPF maturity amount is not taxable !

  10. Chaitanya says:

    Hi Manish

    I have few questions about PPF account

    1) If I have a PPF account which is about to mature soon and I want to take all of that money. But at the same time I want to extend that account for block of 5years. Is that possible?

    2) What happens to PPF account if I take all the money after maturity? Is the account closed ?

    3) If PPF account is closed after maturity and after few months again I want to open PPF account. Should I open new account or can I continue with old account ?

    1. 1. No, you can only partially withdraw money

      2. Yes

      3. Once you close the PPF account, you cant reopen the same account. IN that case again a new PPF account will be active !

      1. Chaitanya says:

        Thanks Manish, If I don’t want to close PPF account after maturity, how much minimum amount do we need to keep in account to avoid closure. What is the maximum amount we can withdraw ?

        1. If you extend the PPF account, then you can only withdraw 60% of the amount

  11. Vanathi says:

    Hai,
    My husband is having ppf account n he invest 10k yearly once, and now he want to open ppf for our kid 2.8 yrs old. Now my question is if he want to increase the investing amt, is that possible in the existing account. And. He wants to start ppf for kid on monthly basis, what is the minimum amt?

    1. There is no fix amount in PPF , you can invest anything from Rs 500 to Rs 1.5 lacs each year .. no fixed amounts each year !

  12. Satish says:

    Me, my non-working wife and minor child – all 3 have PPF accounts. Child account is opened under guardianship of my wife. I want to know how can I invest more than 1.5 lakh in all 3 PPF. Read some below situations and confirm which are valid:

    (1) I invest 1.5L in my own PPF account and 1.5L in minor child PPF account (wife is guardian of chils ppf). I also gift 1.5L to my non-working wife (will keep gift deed) and she deposit that 1.5L in her own PPF account. Is this valid situation and can I go ahead with this? I will not claim more than 1.5L tax rebate.

    (2) In point 1 above, instead of gift to wife in Saving account, can I deposit 1.5L cheque in my wife PPF and also keep a gift deed saving 1.5L gifted to wife who is depositing that amount in her own PPF account?

    (3) If above is not true, can I gift 1.5L to my mother (my mother is senior citizen and non-working) and then she gift 1.5L to my minor child (means to her grand-child) by depositing 1.5L cheque in my child PPF (and will also keep a gift deed). Is this valid?

    My only intention is to put more than 1.5L in PPF (as I trust PPF as the best inveestment option). Please suggest

    1. You cant put more than 1.5 lacs legally .

      1. Satish says:

        But many places it is mentioned that I can give gift to my wife. Is this not correct?

        Also it is mentioned that I can deposit 1.5L in my account and same in my minor kid whose ppf guardian is my non-working wife. Is this also wrong?

        Can you also clarify if I can gift to my sr citizen nonworking mother, who can deposit 1.5L in my kif ppf?

      2. Satish says:

        Hi Manish, Please provide your expert advise here:

        At many places it is mentioned that I can give gift to my wife. Is this not correct?

        Also it is mentioned that I can deposit 1.5L in my account and same amount in my minor kid whose ppf guardian is my non-working wife. Is this also wrong?

        Can you also clarify if I can gift to my sr citizen non-working mother, who can deposit 1.5L in my kid ppf?

  13. Deepak says:

    I had opened a ppf account on my daughters name mahima in 1999 , later her name was changed in school to sonika. At the time of maturity after 15 years , i extended it for five years without realising that my daughter will no longer be minor at the time of extended maturity , as her name is chNged , she won’t be able to operate on ppf account name.whats the solution there is stll one tear to go fir her to become Adult.

    1. You need to show the name change proof !

  14. Avinash says:

    Hi,
    I am working professional. Due to many investments I have no need to invest in PPF to reach 80C limit of 1.5 lac. Therefore I deposit only Rs. 500/- to keep the account active.
    My mother has received some income by way of share trading and would have to pay tax if not invested.
    Can she deposit money in my PPF account and get the benefit of 80C?

    1. No , she cant get benefit by investing in your PPF

  15. Punit Agrawal says:

    Hi,
    If parent opens a account in the name of minor and maintaining in his books of account. Now minor becomes major also maintaining books.
    Transfer is done at bank from guardian name to minor name after becoming major for all rights.
    Now how can we transfer PPF balance as showing in guardian books to child books.
    and what will be treatment in both books.
    kindly specify.

    Thanks,

  16. Alok says:

    Hi Maneesh,

    I have a PPF account and I deposit Rs 1.5 lacs/ annum. Similarly my wife has a PPF account and she deposits Rs 1.5 lacs/ annum.

    I also opened one account each for my two daughters in SBI and have been depositing Rs 1.5 lacs in each account.

    I now understand that the PPF accounts I have opened for my daughters are not valid since one adult can have only one account, not even as a gaurdian. Consequently, I will not get any tax benefits at the time of withdrawal. Please advise how do I withdraw immediately. Does the bank give me an FD interest at-least ?

    1. I think thats not true. One can open another PPF account as a guardian, but can only invest max 1.5 lacs in a year !

  17. Birendra says:

    Refer your Article:

    Scenario 2
    In the second scenario, the mother has one self-PPF account and opens two other accounts to her two children respectively. Therefore, she manages three PPF accounts. At this stage, she can claim a maximum tax benefit of 1.5 lakh under Sec 80C of the Income Tax Act. Moreover, she will have to invest a maximum of one lakh in all the three accounts.

    my Question is : Why she will have to invest maximum of one lakh in all three accounts when permissible investment is one Lakh fifty thousand per year.

    Question No.2: I have two sons, 4 years and 2 years old respectively. Can my wife open PPF accounts in both’s name. I mean 2 separate minor accounts ? she doesn’t have any PPF account till date in her name.

    1. Its a type. It has to be 1.5 lacs

      Yes, you wife can do that !

  18. Anil says:

    Hi Manish,

    I am working as well as my son is working. However both of us contribute towards the ppf ac of my son. While I dont go for 80c benefits but my son does claim 80c benefits under the ppf ac. Is it legal to do so?

    Thanks

    1. He can claim it for his share ..

  19. Sandeep says:

    Hi Manish,

    My kids have PPF accounts. Now they are adults but nor resident in India anymore. How can these accounts be closed and money remitted?
    Do they need to be present physically or will a POA suffice?

    1. I think POA should suffice to redeem the money !

  20. arun says:

    hi Manish,
    I have 1 ppf account , i want to open ppf account for my kid. and my wife is not working, can she be the guardian for opening ppf account for the kid and deposit money in kids ppf account. Will there be any questions asked as she is not earning but investing in kids ppf? arun

    1. No , there should not be any issue like that !

  21. sunil says:

    1. The obvious question on demise of parents/guardian in case of minor ppf is not explained. Please explain and update.

    2. Also what are the procedures to operate a PPF account on maturity of the minor. For e.g The savings account is in name of Guardian/Parents Name but PPF account is in name of Minor name. How redemption will work say will it get transferred to savings account or is it separate redemption form?

    1. Sunil

      Once the PPF matures, and if the owner is a person who was minor at the time of opening it . THey should go for PPF redeemption !

  22. Jayashree says:

    can mother claim 80c benefit if she puts money in ppf a/c when father is not working whose is the guardian of children

    1. Yes she can , even if father is working !

  23. Birendra says:

    Dear Manish,

    I read your Article and found to be very informative.

    I have a question:

    Suppose I open a minor PPF account in the name of my son who is currently four years old. Obviously he will become major by the time PPF account matures. My question is that since the maturity amount will be in his name which he has not earned it, will be taxable. as I, not him will be investing every year. Will he need to pay the tax on maturity.

    1. PPF money is not taxable in the hands of investor. So no tax !

  24. Naveen says:

    Hi,

    I want to invest for my child’s education. Should I take a Child Plan (like ICICI PruLife) or invest in PPF? Please advise which one is better?
    Thanks,
    Naveen

    1. PPF would be a better choice !

  25. Mayur says:

    Me n my wife both utilize deductions under (1.5L each )ppf. My son is 6 months old. I want to contribute to ppf in my son’s name from my father’s HUF account. So is there requirement to add huf as gurdian’s name while opening accont?

    1. Hi Mayur

      A CA is more qualified to answer you query, hence I suggest better get in touch one.

      We are not right people to talk on this

      Manish

  26. Suresh says:

    Hi,
    Recently i went to apply PPF account for My kid(Age 1) in SBI.The bank Manager told ,i can’t open PPF account for my kid ,since i am having a PPF account with my PAN number tagged to the account. He advised me to apply Pan card for my kid and then open the PPF account. Is this true or wrong pls advise. Any one faced this issue.
    Thanks.

    1. Looks right advice to me

  27. Ramesh says:

    Dear Sir,

    Thanks for your help in clarifying many queries on PPF.
    Reading your articles, I realised that I made a mistake and last year deposited Rs 1.5L each in my own PPF account and PPF account of my minor Son (for whom I am the guardian). Now after reading more, I can think of only one option… is to remove myself as the guardian for account of my Son and make my Wife as the guardian. Considering that my Wife does not have ppf account for herself, will it make the whole transaction legal?

    So in essence, if I am able to make this guardian change then I can deposit 1.5L in my own ppf account and another 1.5L in my Minor Son’s account for whom my wife will be guardian. My question is;

    1. Is the above scenario ok?
    2. If I am not able to change the guardian for Son’s account, what is the way out?

    Thanks ahead for your help.

    1. Yes, it seems fine to me

      1. Ramesh says:

        Thanks you Sir.
        What is I am not able to change the guardian for my Son’s Account. I have asked ICICI Bank and they seem to now allow this change of guardian.

        Please help.

        1. In that case you can go ahead and change it !

          1. Ramesh says:

            Sorry sir, there was a typo in my reply. ICICI do NOT allow change of guardian.

            “What is I am not able to change the guardian for my Son’s Account. I have asked ICICI Bank and they seem to NOT allow this change of guardian.”

            Any suggestion on what can I do?

            Please help.

            1. Hi Ramesh

              This is very specific query which you should follow up with the concerned authority only. We wont be able to comment on that

              Manish

  28. Sumit says:

    Hi, I have 2 questions, would be obliged if you could answer:

    1. is the max limit 1,00,000 or 1,50,000 ?

    2. I have 1 child. My wife and I already have a separate PPF Account and deposit the max deposit allowed. I want to invest for my child but PPF adores snot allow more deposit than this fixed amount. Therefore, I would not be able to open a ppf account fr my child. In this case, don’t you think Sukanya child scheme is better as my wife and I can claim max benefit from ppf and I can also invest for my child seperately ? As PPF has a max deposit amount rule of 1,00,000 or 1,50,000 per year ?
    Please advise as I am confused and don’t want to delay the investment for my child.

    Regards,

    1. Anish says:

      Max limit for Single PPF account is Rs 150,000/- for current FY, and one person can not have more than one account. You can open your child account PPF account under the Guardianship of any of the parents, in which you can deposit addition Rs 150,000/- in one FY.

      Sukanya Child Scheme is only for Girls, and Girl age must be below 10 years at the time of opening of account, further there are certain other rules. However in Sukanya, Gov is giving 2 percent addition interest in present FY. Pl check all detail as per your requirement before opening account.

    2. Anish says:

      Sorry due to typing mistake, I mention wrong interest rate for Sukanya Account, for the current FY (2015-16) rate of interest on Sukanya Account is 9.2%.

    3. 1. 1.5 lacs

      2. Yes, that makes sense

  29. ANISH says:

    Dear Mr Chauhan,

    There is no rules in PPF Rules that limit the annual limit of Rs 150,000/- for combined of Individual and Minor.
    Pl read the Rule no 3 of PPF rules again, it is not using the word and , it is using the word or, it means that individual own contribution has no relation with the minor contribution. Further, it is talking about only overall limit of each one separately.
    3. Limit of subscription:- (1) Any individual may, on his own behalf or on
    behalf of a minor of whom he is the guardian, subscribe to the Public
    Provident Fund (thereafter referred to as the fund) any amount not less
    than ` 500 and not more than ` 1,00,000 in a year.

    1. Can you please share those wordings here ?

      Manish

      1. ANISH says:

        Public Provident Fund Act, 1968

        4. Subscriptions to Fund

        Any individual may, on his own behalf or on behalf of a minor, of whom he is the guardian, subscribe to the Fund in such manner and subject to such maximum and minimum limits as may be specified in the Scheme.

        In Rules Subcription defined as follows:

        3. Limit of subscription:- (1) Any individual may, on his own behalf or on
        behalf of a minor of whom he is the guardian, subscribe to the Public
        Provident Fund (thereafter referred to as the fund) any amount not less
        than ` 500 and not more than ` 1,00,000 in a year.

        Pl read carefully, after the WORD OWN BEHALF , WORD “‘ OR'” not and , it means both account limit not to be taken jointly.

        1. Yash says:

          Can you please comment Manish ? Now if you have it and you do not want any hassles after 15 years and you wish to close this account and get the money you have deposited ? what is the solution…

        2. Arpit says:

          If your interpretation were to be true, then why does the banks asks to declare all the PPF account details in the Ac opening form (as mentioned in Pt No. 4 of the article). I think, Mr Manish’s article makes sense.

  30. Tanisha says:

    hi my name is malti. i am widow i have only son of 8 years old so may i fill the form of PPF and how can i submit this form and what is the filling process of this form. plz help me

  31. srinivas says:

    Dear Manish,
    i want to open a PPF account on my daughter’s name (aged 1 year).
    i have a doubt, that as per ppf rules every individual can have only one ppf account. in this case if i open a ppf account, on my minor daughter, once if she becomes major after the maturity of the minor PPF account, does she can open herself a individual major ppf account. ( means i should not spoil her future investment savings after 20 years)

  32. Amit says:

    Manish Chauhan,

    Great article and “HATS OFF” to you for helping so many people on 1 on 1 case bases.

    I have another question which I could not find answer to, even reading 1000+ posts in different forums.

    Situation:
    Me and my wife, both are working abroad. We both were working in India before so we both have salary accounts in SBI and both have PPF account in same SBI branch.
    No kids..No Minors in my case

    Que1: Can we both deposit 1.5 + 1.5 in our own SBI PPF accounts ? without loosing interest ?

    Que2: Is there a rule that one household can/may have 2 or more PPF accounts (for example- Husband and Wife..) BUT all together they can only deposit 1.5 Lacs only. Does not matter if they both are working or not.

    Que3: We both are currently outside India and will return India after 3-4 years but we would continue to make 1.5 Lac (Husband) and 1.5 Lac (Wife) payments to our own separate PPF account using normal SBI SALARY ACCOUNT money transfer (Transfer to self – PPF account) , Is that fine as we are not even Filing ITR because we are not earning anything in India?

    Que4: Should money be transferred to PPF via NRI account only? If someone is out of India for 5-6 years? I do not have any NRI account
    and I am making payments to PPF directly from my SBI salary account by first transferring money to that SBI salary account from abroad.

    1. 1. Yes, you can still deposit the money in PPF , because NRI can also deposit money in existing PPF
      2. No , there is no rule like that. Each individual PPF can have 1.5 lacs investment
      3. Yes, there is no relation of paying to PPF and earning in India
      4. Your SB account should have got converted to NRI account automatically if you had asked for it to your bank.

  33. satish says:

    (1) Myself and my wife both hold individual PPF accounts. We want to open PPF for our minor child (2 years old). Since only one parent can be guardian in PPF (no joint option), who should be guardian – myself or my wife?
    (2) Can both parents allowed to deposit money in minor child PPF account (within 1.5 lakh limit)?
    (3) Can both parents claim income tax rebate in 80C for the amount they deposit in minor child PPF? Or it is only the one who is guardian can claim income tax rebate and other parent can not?

    1. Satish

      1. There is no answer to it, IT can be anyone . Does not matter

      2. Yes

      3. Yes

      1. Satish says:

        Thanks Manish. PPF is opened for minor child under guardianship of my wife. I want to know how can I invest more than 1.5 lakh in all 3 PPF. Read some below situations and confirm which are valid:

        (1) I invest 1.5L in my own PPF account and 1.5L in minor child PPF account (wife is guardian of kids ppf). I also gift 1.5L to my non-working wife (kept gift deed) and she deposit that 1.5L in her own PPF account. Is this valid? I will not claim more than 1.5L tax rebate. Here can I direct deposit 1.5L in my wife PPF via cheque and keep a gift deed saving 1.5L gifted to wife who is depositing it in her own PPF account?
        (2) If above is not true, can I gift 1.5L to my mother (senior citizen housewife) and then she gift 1.5L to my minor kid (means to her grand-child) or she directly deposit 1.5L in my kids PPF (and keep a gift deed). Is this valid?

        My only intention is to put more than 1.5L in PPF (as I trust PPF as the best inveestment option). Please suggest

  34. amol says:

    good one info

  35. Kanagaraj says:

    Hi Manish,

    I have two children’s. I would like to open one each by me & wife.
    Additionally I would like to open Sukanya Samriddi for my girl baby

    Is it possible to open 2 PF (one on my name and another on my wife name). SUKANYA SAMRIDDI on my daughter name?

  36. A says:

    Is it possible to grand mother invest in grandson ppf/lic account and get tax exemption
    Also can my mother invest in my ppf and lic account as her pension is taxable, even though I am taxpayer and not minor those policies and ppf I will not show for my itr from my 16no. instead i will show it from my mother .
    Also myself and my wife both having ppf account is it possible to open another ppf account on my child name and can I claim for tax deduction of same under 80c means both of us or either any one of us able to claim or only the one whos name is given in that application form as parent

    1. Amit says:

      Dear A
      I think its possible but grand mother cant get exemption for same , yes you can open a ppf account on child name and only one of you will get tax deduction under 80c

    2. Yes, grandmother can claim the benefits for investing in PPF for grandson

  37. Raveendra says:

    In my family, whenever my children become earning members, and start having to file ITRs, will they be eligible to pay in amount into their account, through their earnings or gifts… and whether they will be able to top up the limits to 1.0 Lakh or 1.5 or whichever is the permissible maximum figure at that time…

    1. They will have to pay taxes on the income which they would be earning each year,its not related to the amount in account

  38. Raveendra says:

    My daughter is 13 years old. Son is 6 years old. Myself and wife have a PPF account for last 10 years. There was a gap of 3 years when We did not pay the minimum amount.
    Doe the account mature after counting 15 from date of 1st payment or at the last 15 consecutive years?
    Or is there any penalty for the missed years?

    1. You will have to pay the penalty of Rs 50 for all the missed years. Your maturity will be 15 yrs from the starting date only.

      Manish

  39. Ankit says:

    Hi Manish,

    I have an 6 months old Daughter and I am willing to open PPF account for her. Lets say I pay some amount for next 15 years to her account and it matures with Rs x amount.

    Now to my original question that if one account is already matured when she was minor and once she is major, can she open another PPF account as an major for her future financial planning ?

    Thanks in advance.

    1. Even when you open it for her when she was minor, it was HER account. So a person cant have another PPF account . She can only open a new one once the old one is closed. But then why do you need that? She can always extent it for every 5 yrs !

  40. Faizel says:

    Hi Maneesh

    I had opened a minor ppf in the name of my daughter in 2011 with me as guardian at Sbi

    Today I went to bank to club this of with my Sb account at a different branch

    They told me that as the ppf is in minors name it can’t be done

    I was told that all KYC except name was mine like DOB , address proof all were mine but only name is my kid’s

    What should be done now?

    It is like MS ABC (minor) operated by me (guardian₹)

    KYC : sex DOb address all mine..!

    Is this the normal way or should I do some tHing

    Thanks

    1. I think bank is right. PPF account is not yours, its your kids PPF account, why will it be clubbed with your account.

  41. Jig says:

    Hi Manish,
    I am working in middle east and living with family here. Can i open ppf account for my kids in india?
    Thanks

    1. Only if they are not NRI

  42. Rahul jain says:

    I have already deposited rs 1.5 lac in ppf of mine..if I open ppf for my son , 11 month, can it be deposited through my huf file.

    1. YEs, you can do that

      1. rahuljain says:

        am i entiteled for deduction under 80c in both the file……… personal and huf?.

  43. Manthan says:

    Hello Sir, I have a PPF account in my name. My wife is a housewife. Can I open another PPF account solely in my wife’s name and deposit money in that PPF account?

    1. Yes, you can do that

  44. Chidambaram says:

    Dear Manish,

    My wife opened an account in the name of our daughter in 1991 when the daughter was 17 hears old and a Minor. My daughter has not converted this minor account . Now she wants to close this account. What is the procedure?
    The bank (SBI) has advised me that first she has to fulfill KYC norms and then ask for closure.
    Can my wife ask to close the account and transer the balance to the daughters bank account?
    Thanks in advance for your advice.
    Chidambaram.

    1. Hi Chidambaram

      This is very specific query which you should follow up with the concerned authority only. We wont be able to comment on that

      Manish

  45. Anshudeep says:

    I have a query. I have a PPF account (in Post office) on my (Self) name which is due to mature in 5 years (in the year 2020). Say, today (in the year 2015) I have opened a new PPF account (in SBI) for my son (minor and myself as his Guardian) declaring my (Self) PPF Account number . So till 2020, I should claim tax exemption on 1.5 Lakhs (investment among these two accounts). What happens when my(Self) account matures? As in, do I need to inform SBI about the maturity of my (Self) PPF account since I had mentioned about this PPF account under the Declaration section while opening my son’s PPF account? Post that i can claim Tax exemption for the investment done for my Son’s PPF account.

    1. No you dont have to inform them about the maturity !

  46. Ruhi says:

    I opened a ppf account in my name 5yrs back. Now I want to open an account in the name of my daughter who is 3yrs old. I m a widow. Can ideposit 1.5lakh in my daughter account as well as 1.5lakh in my account even though i m not taking tax exemption from my daughter account

    1. SSingh says:

      It is not allowed as per terms and conditions given in official PPF guidelines
      { “http://www.nsiindia.gov.in/writereaddata/FileUploads/PPF.pdf }

      Rule 3. Limit of subscription:-
      (1) Any individual may, on his own behalf or on behalf of a minor of whom he is the guardian, subscribe to the Public Provident Fund (thereafter referred to as the fund) any amount not less than ` 500 and not more than ` 1,00,000 in a year.
      (2) Notwithstanding anything contained in sub-paragraph (1), an individual may also subscribe to the fund on behalf of:- (a) HUF- Deleted vide MOF Notification No. GSR 291 (E) dated 13.05.2005 (b) An Association of persons- Deleted vide MOF Notification No. GSR 291 (E) dated 13.05.2005
      CLARIFICATIONS
      The limit of deposit of Rs. 1,00,000 in a year by an individual in his self account and accounts opened by him on behalf of his minor(s) of whom he is the guardian is “combined” under rule 3 (1) of the Scheme. This limit is separate for account opened by the HUF or an association of persons or body of individuals vide rule 3 (2) of the scheme.
      [MOF (DEA) Notification No GSR 908 (E) dated 6.12.2000]

      1. Thanks for your comment SSingh

      1. Anshudeep says:

        Hello Manish,

        So as per your comment, one can invest 1.5 Lakhs in each of the 2 PPF accounts (Self and Minor of whom he/she is a guardian) i.e. Total investment of 3 Lakhs, and then can claim Tax exemption for one of the accounts (i.e. of 1.5 Lakhs). Is this legally correct?

        As per the document shared by Mr S Singh, I understood that you can only invest a total of 1.5 Lakhs (among the 2 PPF a/cs). Please clarify.

        1. I think you can invest 1.5 + 1.5 and claim just 1.5 for tax

  47. Suresh says:

    Hi Sir,
    I have opened PPF account on my Son name ( Minor) @ SBI. At the time of opening i have provided my PAN details & started availing IT deductions under 80C. I do maintain Savings account at same branch. Today i got call from SBI that they have issue with my PAN as Duplicate ( existing in 2 places ).. My name on SB account and my Son name on PPF .
    Will it be problem ? my son doesn’t have PAN and i would like to avail IT deduction whatever we invest in this PPF account. I don’t have nay other PPF account. Pls suggest how to resolve this.
    Thanks,
    Suresh

    1. You cant claim till 1.5 lacs under 80C. I guess you had given the PAN of yours for your son as a guardian . That is totally fine

  48. Sunny says:

    Hello Sir,
    Good evening,

    I myself holding a PPF account since 3 years, I have opened a PPF account in my daughter name at 1 year of her age she is now 2.5 yrs old, My wife also posses a PPF account,

    I claim 1.5 lacs under 80C for myself, my wife also claims 1.5 lacs under 80C for her as we both are proffesionals,

    Now i would like to ask that how do i proceed with my Kids PPF account,

    Q1. Was i too early to open a PPF account in her name as it would mature by the time she turns 16 years and the money will come to me or to her account, even if i decide to extend the maturity for 5 years more ?

    Q2. How and who should put money into her PPF account, myself or my wife ?

    Q3. IF i pay money in my daughters PPF account can i claim it in my section 80C ?

    Q4. Money that i put in my daughter PPF account will be from my taxable income ?

    Waiting for a apt reply from your side.

    thank you…

    1. Even if the money comes to you, thats ok . It would be tax free and later you can give it to your daughter once she is above 18

      Manish

  49. kavyanka says:

    what is the interest percentage on minor ppf account.

    1. Its not dependent on minor or major, its the same for everyone

  50. Dinesh says:

    Dear Manish,

    I have a question for which i cannot get any satisfactory answer from anywhere. I hope you will be able to help me here.

    I have an old PPF account opened in post office around 5 years back.

    Now recently a few months back I decided to open PPF in name of my newly born child. We approached my Bank and filled up the form and the account got opened in name of my minor child (with me as Guardian).

    However late on i realized i made a small but significant mistake while filling up the application Form.
    I did not enter my own PPF account details in the declaration !

    Now few days after i again approached the bank to make this amdendment, but they said its not possible now.

    Now as you also pointed out, if we do not declare existing PPF details, we can be in trouble. However the Bank branch manager told me not to worry – but i should only keep in mind that i do not invest more than 150000 in combined account.

    Can you let me know if there can be any problem in future since i forgot to declare my own PPF details in form for Minor PPF, even if i do adhere to the overall Limit of 150000 ?

    If so, is there any way to solve this issue?

    regards
    Dinesh

    1. Hi Dinesh

      I suggest that you now take the RTI route. You can file the RTI and ask your queries to them. THey are bound to reply you on your queries.

      Its a bit long cut, but works well

      Manish

  51. PriteshJain says:

    Dear Manish

    I have a PPF a/c in which i deposited 51K and one a/c in Minor Daughter name (Major – as Self) in which i deposited 51K and Another 48K deposited in daughter’s (Minor) name in Sukanya A/c (Major as self in the A/c)

    can i Claim entire 1.5 Lakh benefit under 80 C for total 1.5L investment done by Me ? Investment in Minor;s A/c is Rs 99K and My Name is 51 K.

  52. Anup says:

    Dear Manish,

    Thanks a lot for the informative article

    I have a query with relation to IT Exemption under Sec 80C pertaining to PPF account opened in a minor’s name.

    Last year, my wife (as guardian) opened a PPF account at a Post Office in our 1-yr old son’s name.

    Query: Suppose, she deposits Rs 75,000 per year in the account and I also pay Rs 75,000 separately. Is it OK that we both claim exemption for Rs 75,000 under 80C separately for the payments that we made towards our minor son’s account? Or is it that only my wife can claim the exemption of Rs 1,50,000 (since she is the guardian as per the PPF account).

    Assumption: Further savings for the Fin Year, in both of our case, which may earn exemption under Sec 80C is Nil.

    Tried searching the web for an answer, couldn’t find any. Shall be grateful if you could provide any link to any such resource on the net.

    Thanks

    1. Hi Anup

      You can also clam it .

  53. shyam says:

    Dear Manish,

    NEED YOUR HELP !!!

    Please CONFIRM i have my own PPF account and one PPF FOR MY DAUGHTER under my Guardianship . Both HAVING MY PAN NUMBERS

    Can this is possible , that if i deposit 1,50,000.00 in my daughter account and my father or mother deposit 1,50,000.00 in my account or vice virsa, MY mother or father don’t want any 80 c deduction and in such case i can take deduction of this 1,50,000 in my ITR Deposited in minor’s account.

    OR

    OR it doesn’t make any difference who deposit the money overall limit is Rs. 150,000.00 FOR BOTH THE ACCOUNTS ?

    Please Help ASAP ?

    1. shyam says:

      OR IS THERE ANY WAY (I HAVE HUF ACCOUNT ALSO )

    2. You can only deposit total of 1.5 lacs in both your and your children account

  54. baldev says:

    I have two ppf account in name of minor and contribution made by my huf but now I decided to make contribution by my account. Can it possible ?

  55. Yogesh says:

    My HUF PPF account has matured on 01.04.2015. We understand that the same can not be extended. Please inform if we would continue to get interest in this account till we close this account which may be in Dec, 2015 or Dec, 2016. Thanks

    1. No , the interest will not be credited once its matured

  56. Abhishek says:

    Dear Sir ,

    We have one query regarding ppf account i.e if we open a ppf account with 10,000 / – ( Ten Thousand ) Rs . and next
    Can we deposite only 500 ( Five Hundred ) Rs from next financial year to 15 years.

    Please clear me the process.

    Abhishek

  57. Karthik says:

    Hi Manish,

    Please help me out..
    After reading your books I have become crazy… I am going to dump all my LICs…
    Next comes the ppf…
    I always thought EPF+VPF is enough… But now I understand the need of ppf for my minor children…
    Ok the doubt is,
    Q1. Is there a link between SB account and ppf?
    If the answer is yes then,
    Q2. Me and My wife have a joint account in SBI.
    So is it possible for us to open our own individual (2 accounts)+ 2 more ppf accounts each one for our kids under each one of us… So total 4 ppf with one SB account. 1.5+1,5 L as limit…

    Karthik

    1. There is no link between SBI and PPF , They are independent

      Yes you can open 4 PPF , but the total contribution has to be 1.5 + 1.5 only.

      1. Karthik says:

        Thanks Manish.

  58. Ravindra says:

    Hi Manish,

    I and my wife have separate PPF account and now we want to open another account for our son (2 month old).

    Since we can only invest 1.5 lacs (Self + Minor), is there a way, if I can convert or show my wife account as (I have open PPF account for her) and then inevest 1.5 in my a/c and 1.5 l my wife’s a/c. And my wife can invest 1.5 L in my son’s a/c?.
    Please suggest.

    Regards,
    Ravindra

    1. No , i think in total you can invest 3 lacs only !

  59. Vinoth says:

    Today I visited SBI branch to open PPF account for my minor daughter. They are saying that to open PPF form for minor, we should have the minor PAN card for the daughter. Is it mandatory to have minor PAN card to apply PPF for minor?

    1. PAN card is mandatory I guess. What stops you from getting a minor PAN ?

      Manish

  60. Vishal Gupta says:

    Thanks a lot Manish

  61. A K Singh says:

    Dear Manish,

    I have 2 queries. My son was born on 5 April 2013. If I open a PPF account in his name in FY 2015-16, so it will mature on 1st April 2031 while my son will turn 18 on 5th April 20131.

    1. If I don’t extend by 5 years but withdraw the amount after 5th April 2031 will it be taxable in my hand or can my son as a major withdraw it without any tax implications on me?

    2. In case I have to do partial withdrawals between 7 & 15 years, will the amount withdrawn be taxable in my hand?

    All investments in my son’s PF a/c will be made from my post tax income. Also I do not intent to claim tax benefits on the amt invested in my son’s PPF account.

    1. 1. Your son will be able to withdraw it. In any case, its not taxable at maturity

      2. Not taxable

  62. Vishal Gupta says:

    Dear Manish

    I am for the first time using this PPF platform, read from the beginning, very informative and so many doubts are clear now.

    my question is my PPF account will mature on 31.03.2016 (15 years), I would like to extend it indefinitely (extending 5 years every time ). but i am confused as some bank branched deny to extend after one 5 year extension.

    where i can read in rules that PPF account can be extended indefinitely (extending 5 years every time ).

    If we see form H – here also mention that My PPF account has completed 15 years on —–.

    then you extend period 5 years.

    1. Hi Vishal Gupta

      Its tough to find out the rule book, but dont assume that they will reject it . Just go and ask for it . Ask them to show where is it written that it cant be extended . Take help of RTI if required

  63. Srinivas says:

    Recently I came to know that there is no check on PPF account deposit at PAN level. That means their core banking software doesnot check the total PPF deposit for the year for a PAN number. Thus if one has two dependents, it will not stop him from depositing 1.5 + 3.0(for self and dependents).

    1. Srinivas says:

      The above fact is about SBI.

    2. Hey Srinivas

      Thanks for sharing your experience with all of us. It was a great learning.

      Manish

  64. Alka Sheth says:

    Dear Manishji,

    My son and Daughter in law have opened PPF account for my granddaughters G1& G2 respectively….

    My question is:
    1)can i contribute to my grandaughters PPF ?
    2) also can i cliam deduction unser 80C in my IT filling?

    Thanks
    Alka Sheth

    1. Hi Alka Sheth

      1. Yes
      2. No

  65. Atul Mathur says:

    Hi Manish,
    I opened two minor accounts, one for each child. Let’s call then C1 and C2. One has turned major in June 2014. I got the minor PPF account (C1) converted to a Major account. Now I am confused how the investments during this FY (i.e. 2014-15) will be treated:

    Any amount invested to the account C1 in May 2014 (before child turned major and account was converted to a Major account) be clubbed with my limit of 1.5 Lac or it will be treated as an investment into a separate major account?

    I have invested amount prior to the child turning major in such a way that a total of 1 Lac in vested between my PPF account, C1 and C2. I want to use full 80C exemption for myself for this FY (2014-15). Should I consider investment in C1 as a minor account investment (i.e. I am eligible for full 1 Lac 80C limit) or as a major account investment which will not be counted under my 80C limit.

    I am not getting clarity from my bank. Any guidance you can provide will be appreciated.

    Thanks,
    Atul Mathur

    1. Hi Atul Mathur

      You should take help of RTI now in this case ! .

      Manish

  66. CK says:

    In my situation, my dad had opened a public provident fund account on my behalf around 10 years back when I was 17. He has been contributing to this account till date and has also claimed tax relief under section 80C for the same. This account will mature in 5 more years.

    I have the following questions :

    1. Since I am no longer a minor, can I start contributing to this account right away and claim tax relief for my contributions? I understand that to do this, my dad will have to stop contributing to the account and stop claiming tax relief for the same.

    2. Do I need to submit some paperwork to the bank before I can start contributing to the account or can I start contributing right away and start claim tax relief for the same assuming that my dad will no longer contribute to this account?

    3. What will be the features of such a PPF account with respect to maturity, withdrawals, interest, tax on interest, etc.

    1. Hi CK

      1. Correct
      2. You can directly do that. But still check with bank once atleast by email
      3. There wont be any change

  67. Niyaz says:

    der sir, I am working in Dubai & I have nre account in SBI. can I open my son ppf account. as I have generated opening form which is to be filled and submit. please let me know if it cab be accepted by the branch,

    1. Hi Niyaz

      I dont think its possible

  68. kalaivanan says:

    please tell me a person having epf account can open ppf account

  69. Ankit Sheth says:

    Hello Manish,
    Your articles and knowledge are very impressive. I would like to clarify a few things
    1) In Fy 14-15 max limit for PPF invest ments is 1.5 lacs correct??
    2) I have 1 PPFac in my name I ppf ac In my daughter name with me as gaurdian. so i can invest max 1.5 in these to accounts. but for example i am investing 50000 in lic policies than wats the max i can invest in both PPF accounts? is it 1lac max?
    3) also i have a HUF with me as karta. Can i deposit max upto 1.5 lacs in total, in my and my daughters PPF account and claim tax benefit in my HUF? does it mean that i can in total claim tax benifit upto 3 lacs from my individual n HUF account in following scenario:
    a) From my Individual account :
    50000 in LIC,
    50000 in My PPF
    50000 in my daughters PPF

    b) From My HUF:
    75000 in my PPF &
    75000 in my daughters PPF?

    Is this ok?

    1. You can still invest 1.5 lacs maximum in PPF , but the tax benefits you can get in maximum 1.5 lacs under 80C

      1. Ankit Sheth says:

        i didnt understand what u meant…
        can i invest from my HUF in my daughters PPF account or Sukanya Smridhi Account and claim deductin upto 1.5o lacs in my HUF ?
        please let me know.
        thank you manish

        1. Yes Ankit

          Its possible

  70. Nishita says:

    I went to the SBI branch today to open a PPF account in the name of my child. The objective was to save money for his education and not for tax benefits. However, i was told that i could not open the same as only the Father is the legal gaurdian of the child. I spoke to the branch manager as well and he said the same. This was something new to me and i got thinking why there was a need for such a rule in India. They said ” We don’t make the rules. As per the Indian Marraige act, only the father is the legal gaurdian’. Thanks for your article. Now i know what they said is not correct.

    1. Thats rubbish

      There is no such rule like that. ASk them to give show you that rule, as per PPF application form, it clearly mentions anyone of the parent (Kumar/Kumari) . Tell them in harsh words that you will complain about them to banking ombudsman to give you wrong information. Also ask them if they want their name to be mentioned in a RTI letter which you will write to branch manager and SBI bank.

      http://www.valueresearchonline.com/story/22133

      Manish

  71. Nanda says:

    Hi,

    Me & my wife are salaried employee. We both have individual PPF account. This year i deposited 1 lac in my wife PPF account & i have not made any in my account.
    My question is can i show the investment made in my wife’s PPF account for my tax exemption? Because, my wife will also be showing the same with her employer for tax exemption.. The amount was deposited by me.
    Can both of us claim for a same investment?

    1. No , for same investment you both cant claim the exemptinon !

  72. Derick Machado says:

    Wonderful article & replies to all queries Manish.

    What are the other best options other than PPF to get the tax benefit under 80C for a salaried person whose CTC is 10L ?

    thank you!

  73. Alka singh says:

    Thanks a lot for this superb article,cleared so many doubts regarding PPF account.we r also facing same situation with minor account in post office.we r very much puzzled now because we r investing in minor accounts of ppf for last fifteen years.my one kid is adult now and other is minor.what should i do.

    1. Try withdrawing money right now and most probably there should not be any issue !

  74. Rajat says:

    Dear Manish,

    If I invest 1.5 Lakh in my Ppf account and suppose I also invest some amount in my house-wife ppf account, then the interest income from my wife ppf account will be tax free or will it be clubbed with my income every year ?

    1. Interest income will be tax free from your wife account, but it will be clubbed with your income

      1. Rajat Malhotra says:

        That means I will have to pay tax on that interest income. Then there is no benefit to open a PPF account in House Wife’s name and deposit money in that ?

        1. Yes, you cant bypass it if you have using your own money

  75. Raj says:

    Dear sir
    I have some query regarding PPF account which will may help some other reader. 1) I am NRI & I had PPF account which was open by me before getting NRI status & it is getting mature next year(15 years), I understand that NRI can not extend the PPF account , can keep it ideal after maturity & start deposing in the a/c after 4year(2019) when I will become resident again.
    2) My family is also with me (wife & 2 minor kids)out side of India, My wife having PPF account all of them on my sponsor visa not earning any money can I open account for my minor kid with my wife guardian to that kid.

    Thanks & regards
    Raj

    1. 1. Yes its a good idea

      2. No , NRI is not the one who is earning outside India, but a person who is OUT OF INDIA .. so you cant !

  76. Kartick Krishnan says:

    Hi Manish,

    I went to Axis bank to open a PPF A/c in my minor son’s name(I have a PPF in my name with SBI). Now, the bank ppl told me that I need to have a savings account in the name of my kid with them mandatorily. My question is if I already have a savings a/c with axis, then why do I need to open another account in my kid’s name? Is there a rule mandating that? Your responds would be highly appreciated.

    Thanks
    Kartick

    1. Account has to be of person on whose name the PPF is being opened.

  77. Abhijeet says:

    Is the maturity date 15 years after opening the A/c or is it like ELSS Mutual Funds, e.g. 15 years after every investment ?

    1. monotosh_mondal says:

      Maturity date
      is 15 years more
      from the end of year ..in which account was opened…

      EXAMPLE :-

      PPF A/C OPENED ON 8TH AUGUST 2011
      IMPLIES A/C WAS OPENED IN THE FINANCIAL YEAR 2011-2012
      END OF THIS YEAR IS 31ST MARCH 2012
      15 YEARS ADD TO THIS DATE IS 31ST MARCH 2027
      PPF WILL MATURE ON 31ST MARCH 2027
      ELIGIBLE TO WITHDRAW ON 31ST MARCH 2027 ONWARDS

    2. No its not like that .. Its fixed one date !

  78. Rahul says:

    Hello Manish.

    As usual, an informative article. I have one question.

    Me and my wife have our own PPF accounts. I recently opened a PPF account for my minor kid with me as guardian. He also has a savings bank account with me as second joint account holder. His savings bank account is credited monthly with some amount from both mine and my wife’s account. It also has some cash deposited as part of gifts received on birthdays or other occasions. Now if he deposits this money from his savings bank account to his PPF account, who can claim the tax benefit under section 80/C? Will it be me or my wife or either of us?

    Thanks!
    Rahul.

  79. satheesh says:

    Hi Manish,

    I have 1 PPF account on my name ( which I am planning to dedicate for my son education purpose on long term )

    I have 1 child.

    Now my wife has 1 PPF account on her name – which we are planning to dedicate for retirement point )

    Do you suggest this model ? My only concern was : Is it right planning to divert good amount of money to traditional PPF savings way ? 1 account per child for education is good way. Where as 1 more for safe retirement is it a good plan of savings ? OR I am too conversative on taking risk of my money ?

    Thanks
    satheesh

    1. I think its fine if you both are very conservative investors , else better put money in PPF for the goal which is closer and in mutual funds for your long term goal like retirement

  80. Kalyani C says:

    Hi Manish,

    Nice Article.
    However, I have one confusion.
    I would like to open a PPF account for my minor kid for the current FY. But my PPF limit of 1.5L is already exhausted.
    Is it possible for me to simply open the PPF account in her name this year with minimum amount of INR 500? I am OK if I do not receive any interest for this INR 500.
    Please help.
    Regards
    Kalyani

    1. Yes I think its possible

  81. Rajesh Kr. Thakur says:

    Dear Manish

    Thanks for all the informative scenarios.

    I too have one scenario and need clarification on to this.

    Father being sole earner :

    Father +1 Kid = 2 PPF a/c with a ceiling of 1 Lac. Deposited the 1 Lac

    Father Gives cash say 1 Lac/ Year to his wife and which in turn deposited in to the Mother A/C.

    Now Mother + 1 Kid = 2 PPF A/c . Whether she can deposit 1 Lac it from her A/c Is this legal or what ???

    Regards

    Rajesh Kr. Thakur

    1. Yes, she can do that !

    2. monotosh_mondal says:

      CANNOT DO THAT..
      FATHER TRANSFERRING MONEY TO HIS WIFE….
      IS ILLEGAL..
      CLUBBING YOU INCOME WITH SOMEBODY WHOSE INCOME IS NIL OF LESS
      TO GAIN TAX BENEFITS IS ILLEGAL…
      MOST PEOPLE DO THIS ..ALTHOUGH ITS ILLEGAL…

  82. Dipankar says:

    Today I went to SBI in Kolkata to open PPF account for my two minor daughters. I already have a PPF account with the bank branch for last 20 years. They refused to open tha PPF account saying a father with PPF account cannot open new PPF account for minors. He said its not a bank regulation but its by the GOI and they have circular. To me it is absolute nonsense as long as I do not cross 1.5L in total. I was told to go and try in a post office. Any comment ?

    1. Ask them for the circular .. Also you can open it on kids name with you being the guardian

  83. Thanks a lot Manish for this very informative and useful article. It provided me the exact information I was looking for before opening a PPF account for my son.

  84. rajesh says:

    Govt wants our kids to be only poor. They make useless rules to create problems for society and then give subsidy.

  85. ramanan says:

    http://www.thehindubusinessline.com/money-wise/contribution-to-spouses-ppf-is-tax-deductible/article2932240.ece

    “Since, the Public Provident Fund Act prescribes an upper limit of Rs 1,00,000 for an account in a FY, total contributions made by you and your wife during the FY to your PPF account cannot exceed Rs 1,00,000.”

  86. KR Chaudhary says:

    Hi friends,

    Most important question of additional contribution to minors ppf account..stand clarified by the State Bank of Travancore on its website:-
    http://statebankoftravancore.com/ppf.htm

    see pont no. 5 it removes doubts at one stroke..as it is coming from a govt. bank

    1. Thanks for the link Rajesh !

      1. Sid says:

        Manish,

        Me and my wife both have our individual PPF a/c and I thought it was time to get ppf a/cs for our 2 minor children, so I went to my SBI branch for the forms and to my surprise the lady there said that the minors need to have their own PAN no’s to open the PPF a/c and that our PANs will not work.

        I was disappointed and came back thinking this was a bad thing as I did not want to get PANs for my minor children at this age and open a pandora’s box with the tax dept.

        I had planned to have one minor a/c each with my wife and me and have my mother and my HUF service mine and one minor a/c, while the wife took care of one minor and me the wife’s a/c.

        That way all 4 a/cs would be serviced by 4 different PAN nos, did that make sense?but reading your article and the ambiguity about who can deposit how much, it seems the incoming a/c PAN no is what matters which would be only 2, me with one minor kid as guardian and my wife with one minor kid as guardian.

        It now seems that getting PAN nos for the minors won’t be such a bad idea, a PPF in their name with their PAN would remove the whole argument.

        What do you think?
        I still haven’t calculated the Pro’s or Con’s of having a PAN for the minors so if you have some info on this, would love to hear about it.
        Thanks

        1. ok .. from what I know , PAN number of the guardian is fine , there is no compulsion to have PAN of the child . BUt its a good idea if one has the PAN of kid

          Manish

    2. Umesh says:

      It is the last clause (26) that actually clarifies the issue. It clearly states that:
      The ceiling on deposits as provided for by Central Government from time to time, which is Rs.1,00,000/- in a financial year at present, is both for individual self account and account(s) opened on behalf of minor(s) of whom he is the guardian, taken together.

  87. Umesh says:

    The father that I have quoted invested three lakh rupees / year for three consecutive years.

  88. Umesh says:

    I am aware of one instance where a father invested three lakh rupees (one lakh each) through SBI into his own PPF, his two minor sons PPF accounts for three successive years without any problem only to find at the end of three years that this cannot be done and he received back the principal amount without interest that was deposited in his minor sons PPF accounts (accounts were closed).

    However, a major can invest his money in the name of other majors (children that are >18 year old or even parents or spouse) though can claim income tax rebate for only one lakh.

    1. Thanks for sharing that Umesh !

  89. Santosh Kulakarni says:

    Hi Manish, I do not have a PPF a/c for self, but we have a PPF a/c for our first child which is managed by my wife. I went to SBI today to open a PPF a/c for my second child which would be managed by me (father) and the manager there asks me to give a letter saying “this will bonafide for my child and I will not be claiming any exemption on the amount invested in the PPF a/c”
    Did not understand what this is all about, could you please shed some light on this?

    Thank You

    1. You can claim income tax deductions for PPF , ask the manager why cant you claim the deduction ? It comes under 80C ?

    2. ashalanshu says:

      Dear Santosh, it seems the manager is ignorant of PPF rules. Either ask him to update himself else open the account in any other branch.

      Thanks

      Ashal

  90. subhash says:

    Thanks dear Ashal

  91. subhash says:

    Dear ashalanshu,

    Thanks for ur quick reply,i understand u suggested as below:-

    “Father + Kid 1
    Mother + Kid 2

    Now father self account 500 + 99500 into Kid 1 and 99500 into Mother account + 500 into Kid 2 account.
    Mother self account 500 + 99500 into Kid 2 + 99500 into father’s account + 500 into Kid 1 account.
    Total 4L Rs. in 4 account”

    mine further query is : in mine case only i am the only earner who has to operate all these four accounts, so in this case still the above suggestion works,if i deposit from mine income as suggested by you and take the statuatory applicable income tax benefit of 1 Lac only ?else How ? pls advise.

    1. ashalanshu says:

      Dear Subhash, yes being the sole earner, you can still do it.

      Thanks

      Ashal

  92. subhash says:

    Dear Manish,

    I hav mine own PPF account and wann to open 3 more accounts in the name of my wife, mine 02 minor sons seperatly, can i deposit 1 lac in each account means 4 lacs in four account or i am permitted to deposit ONLY 1 lac in all the four account.

    i understand that i can avail income tax benefit of only 1 lac for mine account and i dd not wann to take income tax benefits of remaining 3 lacs in the other account.

    pls advise.

    1. ashalanshu says:

      Dear Subhash, please read mu comments above, to understand how to deposit 4L Rs. in these 4 accounts.

      Thanks

      Ashal

    2. Thats what we said in article, you cant put more than 1 lac in all the accounts .

  93. TGanesh says:

    PPF was account opened in the name of my son when he was a minor ( with me as father&guardian). My son went abroad for studies & after completing studies has started working abroad. My son has attained majority. The PPF account is maturing. How do I close the PPF account? What documents should I submit? My son is not in India to sign any forms- but he has signed a letter authorising me to close the account and receive the proceeds. If this letter is to be used , do we need to have his signature authenticated & if so, by whom?

    Thanks

    1. ashalanshu says:

      Dear Tganesh, physical presence is not required. Please fill in the form C along with a written request for closure of account. Submit the same to the office (bank or P.O.) where PPF account is maintained. In case the PPF account is in bank, you can ask to transfer the amount directly to your son’s bank account in India.

      Thanks

      Ashal

    2. Hi Ganesh

      Can you open a thread on our forum for this query – http://www.jagoinvestor.com/forum

  94. Pankaj says:

    Hi, I checked with my SBI personal banking branch and as per then we can deposit 1lac to each my account and kid(s). So I have 4 PPF accounts myself H, my wife W, kid K1, kid K2. I am guardian for K1 and my wife is guardian for K2. So I can deposit to 1lac to each H and K1 account and my wife can deposit 1lac to each W and K2. She (manager) said there is no written guideline for this. My kid account K1 is linked to my account H and both have same PAN number. System accept to deposit 1lac for each. So its valid. System is smart enough and does not allow deposit after 1lac. I deposited 1lac last year to my account H and 40k to account K1. And both got interest on 31 March. I discussed all above case with her and still she is confident its valid and my deposits are valid.

    1. ashalanshu says:

      Dear Pankaj, regarding smartness of system, I do have cases with me where people incidentally deposited more than 1L Rs. in a single PPF account through online transfer. Of course the deposits happened in 2 transactions.

      If you want to believe the info provided by your branch manager, do it at your own risk.

      Thanks

      Ashal

      1. Pankaj says:

        Well real question is do we have any written guidelines for this? Nobody confirmed this with any written guidelines. All discussion we have so far is based on personal discussions, personal exp or talks with banks. But all this not proved with any written guidelines. Both ways it looks 100% right so it confuse. May be RTI to concerned department can get 100% right answer or atleast a written proof what they reply. Any body can revert from his/her words. Any idea to which department we shd submit rti?

        1. ashalanshu says:

          Dear Pankaj, please read the account opening form of PPF and you ‘ll come to know what i mean. You may read PPF rule book also. It’s clearly written there if a person is holding self account + minor kid’s account under own guardianship, the combined limit is 1L Rs.

          Thanks

          Ashal

    2. Your take ! ..

      Most of the people at bank are not aware of rules properly. the best thing you can do is ask them to give it on PAPER with their bank letterhead so that you have a valid proof !

  95. Adi says:

    At what rate is the withdrawal amount of ppf taxed? It is only the interest part or the whole sum that is taxed?

    Can I close one ppf on maturity and open another one after a couple of years?

    1. ashalanshu says:

      Dear Adi, please read my reply given above to your prev. query.

      Thanks

      Ashal

    2. Withdrawal from PPF is NOT TAXED

  96. Adi says:

    Dear Manish,
    Your article is excellent and I seek certain clarifications of my personal ppf case in 2 parts.

    1.)My father opened a ppf account in my name in 1994, when I was 8-yr old (minor) and I took over the account on attaining the majority. Going by the rules a ppf should end in 15 years; so it ends in 2009 in this case. In 2009, on I opted for an extension of 5 years, which means it ends in 2014.
    a.) Can I extend this account for another 5 years from 2014?

    b.) If I cannot extend, I will have to withdraw the whole amount
    (Principle+interest earned). In case of withdrawal, what part of the amount is taxed and at what rate?

    c.) If I withdraw this account, can I open a new ppf account in my name now and run it for another 15 years?

    Apologies if the questions are too basic or if I’ve missed anything information covered in your wonderful article.

    Thank you

    1. ashalanshu says:

      Dear Adi, after completion of 1st block of 5Y, you can reapply for extension and can extend your existing PPF account any number of times you w’d like to. PPF is EEE instrument so in case of withdrawal neither principal nor interest is taxable.

      As you can extend your existing account, no reason to opt for closing current account and opening new one.

      Thanks

      Ashal

    2. a) yes, any number of times

      b) You can extend it

      c) Yes you can do that, but its better to just continue the same account, you get the liquidity every 5 yrs !

  97. vignesh says:

    Hi Manish

    My mother is Home maker.

    So now i have PPF account in which i transfer .25L per yr and i want to open a one for my mom.

    can i contribute 1L to my mom and my mom allowed to use in her 80c ? and i can also parallely contribute up to 1L in my PPF ?

    Is the above thng ok ?

    1. ashalanshu says:

      Dear Vignesh, Yes. To let her claim her own 80C, you just transfer amount into her SB account and from there she should invest in PPF account.

      Thanks

      Ashal

    2. You can contribute, but you will get no benefit !

  98. Suresh KP says:

    Good article Manish. Your point is right that Rs 1 Lakh is the maximum which we can invest in minor child + self. I heard from some of my friends personal experiences.

    1. Thanks for your comment Suresh !

  99. VB says:

    Hi,
    Checked with SBI & Post Office. From April 2013, there is a new ruling – if the parent has a PPF account, then another PPF account in the name of minor child cannot be opened up. So, net-net: you can have only one PPF account.

    Regards
    VB

    1. Srinivas says:

      I could open account in SBI for my second (minor) son two months back. I have a PPF account for self and another PPF account for my elder son.

      It appears the instruction might not have trickled down properly.

    2. ashalanshu says:

      Dear VB, show me the so called new ruling. Please do not say that your bank staff told you so. Please provide me the proof from Govt. notification.

      Thanks

      Ashal

    3. Is there a circular on this ? Can you please share !

  100. bharat shah says:

    thank you ,Ashal for information as always.

  101. bharat shah says:

    @ashal,
    you are very much correct and i am wrong! even child’s own income from any art is getting clubbed with that of parents’, then it is futile to think correct for treating income on income on gift his own.

    1. ashalanshu says:

      Dear Bharat, if the income is earned by child by applying her own skills, that income belongs to her only and it should be filed for ITR under her own PAN.

      Thanks

      Ashal

  102. bharat shah says:

    @ashal,
    i read your comments after extending my comment as above. you may be correct , and would like to check/get further thoughts from other members. but by logic, gifting to spouse/kid could be the same, i.e. spreading the corpus legally to the loved ones with sacrificing the legal ownership. for kid, after attaining major , he will definitely getting the title of whole such gift plus the earning on it in total, which is not the case of spouse.

  103. bharat shah says:

    in regard to above comment, i like a hypothetical example for clarifying:
    parents invested in minor kid rs.50000/- yearly for 15 years in ppf with interest @8.5% p.a. will fetch @ rs.1411613/ at end of 15 yrs-. out of that , parents’ part would be rs.750000/- principle + rs.63750/- interest earned , total rs.813750/-, while balance rs. 597863/- would be kid’s corpus . so after 15 yrs the kid would earned his own income on further investing rs.597863/- and that would not be clubbed to parents’. the figures may not be exact . please clarify if the my understanding is not correct

  104. bharat shah says:

    ‘ So imagine PPF (Public Provident Fund) account is matured and the kid is still minor (assume you opened the PPF when he/she was 1 yr old) and you get Rs 10 lacs from PPF account, now when you invest this 10 lacs into FD , you get Rs 1 lac as interest in a year, this interest income will be treated as your income (guardian income) and will be added into income and taxed accordingly.’
    though interesting post and comments in matter of PPF a/cs opening and its taxation ,i differ slightly on matter of reinvestment of kid’s maturity a/m before getting major. as the matured a/m got two part:one principle invested by the parents plus interest earned on that principle year on year and other the interest earned on interest accumulating year on year, which i think, is now the kid’s own corpus. so when it is further invested in taxable income product, say bank FD, though the interest earned on the a/m equivalent to the principle originally invested by parents would be clubbed, the interest earned on the kid’s corpus would not be clubbed with parents.

    1. ashalanshu says:

      Dear Bharat, till the kid is minor, the income ‘ll still be clubbed with parents,even if it’s income from income. If applying your logic, I as a parent, investing 10L Rs. in a FD for 1Y and earning 90000 Rs. as interest under my Kid’s name, reinvesting the same in 2 FDs of 10L and 90000 Rs. the income generated from 90000 FD should not be clubbed with my income, well wrong thought. 🙂

      I think you misunderstood with clubbing provisions of spouse income from investment of gifted amount from once’s spouse.

      Thanks

      Ashal

  105. Dear Manish Ji,

    A. If possible please share the analyses on two policies: –

    1. Max Life Life Partner Plus Endowment to Age 75 Plan – 20 Pay
    2. Max Life Shikha Plus II

    B. Please recommend a term plan and a health insurance policy too.

    Thank You
    Regards

    Gaurav

    1. ashalanshu says:

      Dear Gaurav, any combo plan can not provide the best of both worlds for you. Actually it ‘ll neither provide good insurance nor good return on your investment. So both the policies you are asking for review, should not be considered.

      Please purchase a term plan from the insurer of your choice. the best term plan is one, which ‘ll process your death claim in least possible time and with out creating any trouble to your family but unfortunately, you ‘ll not be there to see it on your own.

      In case of health insurance, please opt from Oriental, Apollo, Religare, Bajaj, Max.

      Thanks

      Ashal

    2. For detailed analysis, please ask a question on our forum http://www.jagoinvestor.com/forum

  106. Dear Manish Ji,

    I would like to know for how many times PPF account can be extended after 15 Years ?

    Thank You
    Regards

    Gaurav Juneja

    1. ashalanshu says:

      Dear Gaurav, as many times as you like. Till you like it or till your death.

      Thanks

      Ashal

  107. Hari Prasad says:

    Your article on PPF is excellent and i feel every informed reader enlightened by reaxing it

    1. Thanks for saying that Hari 🙂 . That was the intention of the article 🙂

  108. Arun says:

    Dear Manish,
    Can I open a PPF account for my wife (who is a housewife) and my 1 year son? How much can I invest in all 3 PPF accounts combined?

    Thanks
    Arun

    1. ashalanshu says:

      Dear Arun, you can open 1 account for your wife and another one for your minor son. In total you can invest 2L Rs. 1L between your own and kid’s account and another 1L into your wife’s account.

      Thanks

      Ashal

    2. Yes you can open, but you cant invest maximum 1 lac in all of these accounts

      1. Srinivas says:

        Any major(completed 18 yrs) can open an account(PPF in this case) on their own.(Bank practices vary and some bank may need introduction). Opening on some one’s names arises only when she is a minor.

        If you see legally(illogically), one can invest 1 laks in his account if he is a major. However, if one opens for a ward, again legally(illogically) he can invest a total of Rs 1 lakh in both(or 3 if 2 children) accounts put together.

        Due to various reasons(post offices are not automated fully and many bank staff donot know the nuances), there is no check on this. And the practices vary widely from bank to bank.

        A minors account can be converted to a full fledged account when she attains majority. Then total eligibility of family for PPF investment increases.

  109. seeni_pv says:

    Dear Mr.Manish,

    Thanks for the wonderful article. I have a question, please clarify

    1. Is the deposit amount for ppf account fixed or it can be a variable amount each year as long as the mount we are depositing is within the min and max limit?

    Regards,
    Poovannan

    1. ashalanshu says:

      Dear Seeni, you have the liberty to deposit the amount as per your choice within the limits specified each year.

      Thanks

      Ashal

      1. seeni_pv says:

        Dear Mr.Ashal,

        Thanks for the clarification. the reason behind my questions is If my financial terms are not good (Believe it won’t happen) in a particular year or two i can refrain from depositing the max amount of 1 lac each and just deposit as less as Rs 500 which is the min deposit amount.

        Regards,
        Poovannan

        1. ashalanshu says:

          Dear Seeni, yes you can continue with minimum 500 Rs. in a Year.

          Thanks

          Ashal

          1. seeni_pv says:

            Dear Mr.Ashal,

            Thanks again for the clarification. I got couple of more questions.

            1. As it is possible to switch the ppf account from one bank/post office to other bank/post office. Is there any limit for no of switches one can do?
            2. Is there any charge involved in switching ppf account from one to another bank/post office?

            With Best Regards,
            Poovannan

            1. ashalanshu says:

              Dear Seeni, you may transfer your PPF account any number of times from banks to banks or banks to P.O. or P.O. to Bank. There is no penalty on you for these multiple transfers. But problem may be there for the fact that any wrong calculation for interest done by prev. entity (bank or P.O., as the case may be) may result in losing such interest on your account. I do have example with me where during transfer of PPF account due to wrong interest calculation, old institution credited less amount.

              Although it was a few years ago when the system was not computerized.

              Thanks

              Ashal

    2. Harsh Rathod says:

      Remember that only 12 installments / transactions are allowed.

  110. ongkie says:

    hello manish,
    i am in delimma. I have 2 ppf accounts (for self and daughter ) and my wife has 2 ppf accounts ( for herself and son). we have been depositing a total of 4 lacs in all accounts for the past few years. what are our options now? please advice.

    1. ashalanshu says:

      Dear Ongkie, better late then never. Please start correcting your ways from here onwards.

      Thanks

      Ashal

      1. ongkie says:

        hello ashal
        That is sound advice..thanks. But what will happen to the excess deposits? Will withdrawing partial amounts after 5 years rectify the mistake? Also i think the government can easily have a software programmed to alert investors when their maximum amount has been reached…but they purposely chose not to. I know from personal experience that if one person tries to open 2 accounts then a message is displayed preventing any further action. ..so why not the same for deposits

        1. ashalanshu says:

          Dear Ongkie, actually you can still invest 4L Rs. in 4 accounts but you do need a little bit play around. Please check the comment of dear Symantak above.

          Thanks

          Ashal

          1. seeni_pv says:

            Dear Mr.Ashal,

            Referred to the above said post where the scenario for 3 poeple & total investment of 3 lacs has been explained. Below i’ve come up with a scenario for 4 people (including 2 minors) & total investment of 4 lacs. Please correct me if i’m legally wrong.

            1. Family of father, mother & 2 minor kids.
            2. Mother open a ppf acc for her own & assuming guardian for both minor kids. She invests 10k in her own acc & 40k each in minor’s acc (Total 1 lac)
            3. Now father of that family open a ppf acc and invests 1 lac for his own account. In addition since he is not a guardian he can invest 90K in wife’s acc and 60K each in minor’s acc (total 3 lacs)

            Another interesting thing about ppf is it is better than FD. While the interest gained in FD is taxable where as it is not taxable in ppf but the interest gained is better or same.

            With Best Regards,
            Poovannan

            1. ashalanshu says:

              Dear Seeni, yes it’s possible. I w’d prefer for the given situation like this.

              Father + Kid 1
              Mother + Kid 2

              Now father self account 500 + 99500 into Kid 1 and 99500 into Mother account + 500 into Kid 2 account.
              Mother self account 500 + 99500 into Kid 2 + 99500 into father’s account + 500 into Kid 1 account.

              Total 4L Rs. in 4 account.

              thanks

              Ashal

            2. psdobal says:

              Dear Ashal and Poovannan:
              My wife (W) has had her own PPF as mine (M)
              I just happen to open 2 Minor C1,C2 PPF A/C s last month. After going through your analogy, I seem to have two options:

              1. Since both C1 C2 PPFs have my PAN, I should get one C under my wifes Gaurdinship.
              2. I can deposite say 49.5K in each C1,C2 PPF and rest 1 k in mine. And the remaining 51.5k in C1,C2 and 99k in my PPF can come from W. While I deposite 1Lac in my wifes PPF.

              Please comment if I have understood the concept and my plan is not against the rules of PPF. which option should I opt for?
              prem

            3. ashalanshu says:

              Dear Psdobal,yes it’s OK.

              Thanks

              Ashal

            4. No, you cant deposit more than 1 lac in total from your pocket and same for your wife, so you both in total cant deposit more than total 2 lacs

    2. You are not doing right, As I said , if detected, you will not get interest on the additional money and will get it back without interest . I suggest not doing it next time

      1. Srinivas says:

        The issue many were debating is simple. Can they deposit more than the specified amount.

        Legally, one cannot. But as the enforcement is weak, If one does, One may not get caught. (I mean, Chances are less). This is a gamble, one can take, specifically if ones child is near majority(16 or 17 years). This is because, in a year or two, the child will become major and she can invest as per her limit.

        However, there many other avanues where one can invest with equal result without any conditions.

        For example FD’s in some banks. If deposits are in (non working) wife or parent’s name, the interest tax can be saved.

        Similarly money market funds. they are also giving equal results, if invested properly.

        These avenues have additional advantage of liquidity. However, this is a double edged sword. If one is not disciplined, one may tend to withdraw and empty out the account.

        Thus one need not over do PPF and feel she is doing something illegal. It is better if one understands personal finance in detail and plan one’s strategy accordingly.

        1. ongkie says:

          dear srinivas..
          i totally agree with you. i have a total excess deposited of 8L. Do i get a refund? Can i withdraw the amount at once? Will the amount continue to earn interest?

      2. psdobal says:

        Dear Manish:
        Thanks for correcting. Is it possible to close the “minors” PPF accounts as mine were opened in Jan 14.

        1. ashalanshu says:

          Dear Psdobal, the answer is NO.

          Thanks

          Ashal

      3. psdobal says:

        Dear Manish:
        Just to share- I visited and talked to the bank about the combined limit of all my 3 PPF accounts. It appeared that it has been a common practice for all to deposit 1 lac in every PPF account irrespective of how many minors PPFs one has opened.
        Thanks again for highlighting the very crucial point which all (including financial institutions) seem to overlook.

        1. Welcome . So did the bank tell you that maximum 1 lac can be deposited in all PPF account

          1. psdobal says:

            Dear manish:
            Sorry. it was other way round. I was told that I can deposit maximum 1 Lac in each account. But, I can avail tax benefit upto 1 Lac only- not 3 Lac.
            When I told that the maximum combined limit is 1 Lac. I was told that these are Kids account not mine, so I can deposit 1 Lac in each a/c without any problem- which I shall avoid because I can not close the minor’s PPF a/c before 15 years.
            pramod

            1. No , that is wrong .. even they dont know the rule

              You should not deposit more than 1 lac in total, right now technically the system does not check it , but in future if they know about it, you will not get any interest . The onus is on you to KNOW things !

            2. Velmurugan says:

              Dear Mr. Manish
              I am also facing the same situation, but when I discussed with the SBI bank people, they showed the rule of PPF and told me, eventhough it is kid account it is entirely different account with different PAN, so there is no problem in future also. No question who is investing the money. Please reply.

            3. Was that written in the RULE BOOK ? I dont think so .

  111. Ankit Gupta says:

    Dear Manish,

    A very informative article.
    Thanks for it. I have a few queries.
    1. After maturity of my PPF account can I keep extending it in the blocks of 5 years.
    2. In case I open a PPF account for my kids and it matures after they are 18+ then can they keep extending it in the blocks of 5 years till they want. Further in case they want to open their own PPF a/c can they do it during the period when the a/c which I have opened as guardian for them is still running.

    1. ashalanshu says:

      Dear Ankit, after initial 15Y period, you may extend your own PPF account any number of time for blocks of 5Y each.

      For your kid’s account, it’s advisable to continue the old account with multiple extension of 5Y blocks. NO, as a PPF account is already running in a major kid’s name, new PPF account can not be open in parallel. Yes after closing the old account, new account can be opened. Please do remember, if your kid opt to close the old account, the money ‘ll be paid to him and now to invest the same in a tax free investment ‘ll be a problem. Hence it’s advisable to continue the old account.

      Thanks

      Ashal

      1. Ankit Gupta says:

        Thanks Ashal for clarifying my queries.

    2. 1. Yes

      2. Yes, they can extend it later, but they cant open another one . One person can have only one PPF in their names

      1. Ankit Gupta says:

        Thanks Manish,
        This means that if we open a PPF a/c for our kids they going reap good benefit when they reach the age of their retirement or in case they need money before.
        This can be really long planning.

        1. ashalanshu says:

          Dear Ankit, yes is the answer.

          Thanks

          Ashal

        2. Yea true .. its a good long term product , but dont over do it !

  112. Daljit says:

    I have an EPF account but no PPF account.

    Would the PPF account I open for my child be clubbed along with EPF limit. For ex. If I am contributing 50000 to EPF account, then could I contribute 100000 to PPF account or only 50000?

    1. ashalanshu says:

      Dear Daljit, EPF and PPF are different. so your contribution to your EPF account ‘ll not impact your kid’s PPF account. You may invest full 100000 Rs. in your kid’s PPF account.

      Thanks

      Ashal

    2. There is no relation between EPF and PPF . NO effect on each other actions

  113. RATTAN LAL says:

    can a father make a deposit in his taxable son’s PPF a/c, to avil 80c benefit for himself.

    1. ashalanshu says:

      Dear Rattan, Yes. even after the child becomes major and not contributing into her own PPF account, father or mother can still invest in child PPF account and claim tax benefit on it.

      Thanks

      Ashal

      1. ashalanshu says:

        Dear Manish, Parent can invest in Major Kids’ account.

        Thanks

        Ashal

        1. Ok , I was confused on that may be !

          1. ashalanshu says:

            Dear Manish, no problem.

            Thanks

            Ashal

    2. T D BASRA says:

      can father contribute to wards ppf account of married sons/daughters and claim exemptio from income tax

      1. No ,its only when you do it for minors

  114. Pingback: Anonymous
  115. DEEPAK SHARMA says:

    VERY GOOD MANISH JI, AFTER READING SUCH A GOOD ARTICLES ABOUT PPF A/C , NOW I AM PLANNIG TO OPEN PPF A/C FOR MY WIFE OR MY 2 CHILD.

  116. Kiran Kumar says:

    I have one option to add to the scenario, Experienced members shall say whether it is possible or not.

    In a family of 3 (Husband, Wife & a Child):

    Suppose a Father(F) will make a PPF to himself and to his minor Child(C) and Mother(M) will also make PPF to herself and to her minor Child(C). F will deposit Rs.5000/- in his own account and remaining Rs.95000 in C PPF A/c and M will deposit Rs.5000/- in her own account and remaining Rs.95000 in C PPF A/c. In such condition minor child after becoming a major will have a good sum of tax free amount.

    This can be followed only F & M have a sufficient exemption to be claimed under 80C.

    1. ashalanshu says:

      Dear Kiran, please check your reply, in total you deposited 190000 Rs. in C account which is not possible. Please read the comment above given by dear Syamantak for the scenario you are asking for.

      Thanks

      Ashal

      1. Kiran Kumar says:

        I am thinking that F will open a Account in the name of C separately and M will open a Account in the name of C separately.

        In this Case they are disclosing the account maintained by them and they cannot give the other accounts maintained by other person in the name of C. (As per Application form Declaration).

        Please Correct me in this regard.

        1. ashalanshu says:

          Dear Kiran, opening 2 PPF account for a single person is illegal. So how can you open 2 accounts for this child?

          Thanks

          Ashal

  117. Srinivas says:

    True.

    HUF is like Knight in chess. Provides good flexibility.

  118. Dipak says:

    Good Explanation
    As per my knowledge is concern HUF cannot open PPF account.
    My query is that whether HUF can deposit in kids account

    1. ashalanshu says:

      Dear Dipak, Yes, HUF can not open new PPF account but it can deposit contribution into members’ PPF account. In this case, the section 80C limit ‘ll be 1L Rs. to claim from PPF investment for HUF but all PPF accounts can be topped up from HUF money.

      Interestingly in this case, if the above exampled family is also having HUF, the HUF can be used to park 4L Rs. in total in husband, wife and 2 minor kids’ account.

      Thanks

      Ashal

      1. Dipak says:

        Thanks

  119. Ganesh Kamath says:

    Hi,

    I have a doubt
    once the minor attains 18yrs and becomes major , can we deposit full one lakh in his account and one lakh in the parents account , even though the person is not earning and still a student.

    thanks

    ganesh

    1. ashalanshu says:

      Dear Ganesh, yes a parent can deposit 1L in self account and another 1L in major kid account. Now extending the above family diagram as given by dear Manish, let’s assume both children are also major now after some years with their old PPF account. Mother is a house wife. Father is earning a decent income. Now at this point, the father can invest the maximum 4L Rs. (1L *4 individual accounts) in all the 4 accounts.

      Thanks

      Ashal

  120. Kranti Goyal says:

    Hi,

    As mentioned in article that If child becomes major than child will become owner of PPF account and he can start deposit his own money. I have one question will he need to wait for another 15 year lock in or he can extend PPF for 5 years.

    If extension is like every 5 year than its good to open child’s PPF account as early as possible. So when he start earning and depositing money in PPF account he will enjoy only 5 year locking instead on 15 year locking.

    Thanks and Regards
    Kranti Goyal

    1. KRANTIVIR RAJPUT says:

      YES. So it is always advisable and better to open MINOR-PPF.

    2. Yes, it can be extended for 5 yrs after maturity !

  121. Srinivas says:

    Interesting points.

    Actually this 1lakh is arbitrary and was increased from 70000 upwards few years back. There is no relation with any physical parameter(inflation,GDP etc).

    I feel that one can take calculate gamble, specifically when a child is nearing 18. One can have his PPF account in a back and for a minor in post office. Post office systems are not fully integrated. Deposit money (2 lakhs max).

    If at all one looses interest for a year or two, but once child becomes major, situation changes.

    Calculated gamble. Can turn either way. But still……………

    1. Yea , one can take that bet 🙂

  122. Syamantak says:

    Hello Manish,
    In one of the popular Facebook groups, I read an interesting point which allowed altogether 3 lakhs to be saved for a family of 3. Here is how it was done. Both the parents have PPF accounts and additionally opens an account for Child (C). Now the suggestion says that the Father deposits 5K in his own account and 95K in Child’s account. Now Mother is suggested to Deposit 95K in husbands account and 5K in child’s account along with 1L in her own account.
    Now since the father is guardian of the children account, he’s within the limit of a total investment of 1L. Since mother is not marked as a guardian, she is entitled to deposit additional money in husband’s and child’s account, while depositing 1L in her own account.

    This seem to be interesting for the people, who want to gain the tax free interest but not interested in 80C. Isn’t it?

    1. Akash says:

      That is great interpretation of law.I dont think there will be any disallowance.

    2. priyajitgh says:

      great interpretation.It just opened a new avenue.Need experts’ confirmation regarding this

    3. ashalanshu says:

      Dear Symantak, yes it’s possible. 🙂

      Thanks

      Ashal

      1. Syamantak says:

        I was waiting for your post Ashal. You are the great person who gave this idea 🙂
        Thought of sharing it here since not all are a part of the FB group

        1. ashalanshu says:

          Dear Symantak, that idea is about legally play within the given rules. 🙂

          Thanks

          Ashal

    4. jeearbi says:

      This may not be possible as the combined subscription to Father’s PPF and his child’s PPF a/c exceeds 1L. Otherwise what prevents the Mother depositing say 2L in Father’s PPF a/c?
      Jeearbi

      1. ashalanshu says:

        Dear Jeearbi, the basic limit is 1L Rs. hence Mother can not invest more than 1L Rs. in father’s PPF account. 🙂

        Thanks

        Ashal

        1. Sachin Ashturkar says:

          I just returned from SBI where I hold a savings and a PPF a/c. I informed them that I needed to open a PPF a/c for my minor kid with me as guardian.
          I inquired about this possibility of my wife or any other person depositing funds into the minor’s a/c.
          I was told that money that can be deposited into the minor’s a/c HAS to be the guardian’s money. So, if my wife wants to deposit funds into our kid’s a/c, she has to first transfer it to me and then I can transfer the same to my kid’s a/c.
          This defeats the “loop-hole” of someone circumventing the “spirit” behind the rules.
          Can someone get word on this from the govt. dept. handling PPF?

          1. ashalanshu says:

            Dear Sachin, Thanks for the update. Are you aware that from any bank account now you can invest in PPF account through netbanking? Now If someone is investing online, how can SBI people check that it’s guardian account or someone else’s account.

            Interestingly HUF’s money can be put in directly into it’s member’s PPF account. No matter the member is major or minor.

            Thanks

            Ashal

            1. Harsh Rathod says:

              Account number is always linked to PAN Number this days. SBI can easily come to know if it WANTS to.

  123. Kundan says:

    Good job once again 🙂

  124. Joseph says:

    Since there are no tax benefits, what are the advantages of splitting the investment into 2 account (parent & kid)?

    Thanks,
    Joseph

    1. Tax benefit is there till 1 lac under 80C for combined amount (self + kid)

  125. sk sharma says:

    I have opened 2 PPF a/cs in the name of my children aged 7.5 nad 4.5 years with my wife’s PPF a/c.
    When they will become major, PPF a/cs will still be completing 15 yrs period.
    After attaining 18yrs will their PPF a/cs still be clubbed with their mother’s or all will be independent PPF a/cs?

    1. ashalanshu says:

      Dear S K sharma, as the maturity – 15Y completion ‘ll happen post majority for both kids, question of clubbing does not arise and both PPF accounts ‘ll be treated for respective kids’ names.

      Thanks

      Ashal

    2. It will be independent !

  126. Great article about PPF, Manish.

    Thanks for clearing the doubt about the limit of 1 lac.

    Vinod

  127. Akhilesh says:

    Very good article as always….. yr articles has given me lot of financial wisdom….. thanks a ton

    1. Good to hear that !

  128. Akash says:

    Even IMPS transfer is possible if you have account in SBI. But IMPS after 8 PM will have next day date.

    1. Thanks for sharing that !

  129. Sachin Ashturkar says:

    Hi Manish,
    Very good article! Also, it came in at a very good time for me, since I was contemplating opening ppf a/cs for my 2 minor kids (one with self as guardian and other my wife).
    We both are maxing out on our ppf limit every year, so I think I will just wait till they become major to open an a/c on their name.
    Then, at that time, can I fund my kid’s a/c with my money, without breaking any laws? For that matter, can anyone deposit money into any major’s ppf a/c without any backlash to the depositor?
    Thank you.

    1. Yes you can invest in major children PPF also

  130. Lakshmaiah says:

    Dear Manish,

    Very good article.

    I have two kids and wanted to open the PPF account for 4 of us (Myself, Wife,C-1,C-2). As you mentioned in the article I do not intend to claim tax benefit under section 80C.

    My Initial assumption is to invest 1 lak each in all the accounts as the amount is not taxable on maturity. But after reading this article, it looks like not correct as per law and we may loose the interest portion if get caught. so what is the solution for this? Pls suggest?

    Thanks
    Lakshmaiah

    1. The thing is that you are 2 adult (husband + wife) , so maximum 2 lacs total can be invested in any number of PPF accounts. Maximum 1 lac by you and another 1 lac by wife. Now how you want to structure things depends on you. If you want to put maximum in children PPF account, then the best thing would be to open 1 child PPF with you and another child PPF with wife and put major part in child account (like 80k) and rest 20k in personal account. This will be beneficial only if you are claiming 80C benefits from some other investments . Now in future at maturity times, PPF;s for kids will have a good amount and they will be ready to take hold of them

      Manish

  131. Sharad Madan says:

    Great and easy to understand article 🙂
    Even recently I came to know about this 1 lakh limit inclusive of self and minor account. But I already submitted 1 lakh each in both accounts by then….I hold both PPFs in ICICI. It has been 14 days since I raised the issue with ICICI for getting a solution. They have raised some requests internally and still bogging there head as what to do now. I talked to their auditor as well and recommended to make there online system full-proof so that more than 1 lakh submission is not possible at least where both PPFs are in same branch (may be they can track thru PAN…becoz same PAN is used for self and minor’s account)…lets see what happens….I really don’t want to loose interest at maturity for this mistake..

    1. Thanks for sharing that with all of us !

      1. Sharad Madan says:

        Recent and interesting update…Got an email from o/o Head Customer Service ICICI that transaction can be reveresed in any of the two PPfs account and I have to submit a letter stating this to nearest branch. I have done the same and eeping the fingers crossed….

        1. Ohh great. . thanks for sharing that with all of us !

          1. Sharad Madan says:

            Good news!!! After rigorous followups, the transactions in PPF a/c got reversed Yesterday. Now amount invested in both the accounts combined is under one lakh in current FY.

  132. Raj Singh says:

    Father can open PPF account for himself and C1 (or C2) , Wife can open PPF account for herself and K2 (or K1).

    What’s K2 and K1.

  133. Ashwin says:

    yeah, this is a good article Manish. I also opened a PPF account for my kid a few months back. It will mature before age 18, so will be extending it for 5 yr block & then depending on Kids edu need, will withdraw money, but will not close the PPF account.

    1. Yea , thats a right thing

  134. Nirajan says:

    Thanks Manish! Lucid and crisp as usual!!! 🙂 hats off!!

  135. Som says:

    Hi Manish,

    As usual great article. Really learnt a lot from your site.

    Just to mention, in the above article may be the pictures for Scenario 2 and 3 needs to be swapped.

    Keep up the good work, waiting for the next article….

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