PPF for wife

POSTED BY Amit Agarwal ON November 5, 2012 5:10 pm COMMENTS (9)

My wife is housewife and she does not have any income but i files ITR for her every year. Now i am planning to open PPF account for her and the queries are:

1: Can i show this investment in her ITR under 80C?

2: Final PPF corpus will be TDS free after 15 years?

9 replies on this article “PPF for wife”

  1. Dear Amit, what’s the update from you now?

    thanks

    Ashal

  2. Sanjay says:

    @Amit, as per PPF rules, maximum amount that can be contributed by an earning member is Rs 1L pa. So you can spread this 1L in diff PPF accounts of your family ie Minors.
    However as per PPF rules, any amount contributed over & above Rs 1L (Earlier Rs 70K) will not earn any interest.
    So If your wife is investing upto Rs 1L in PPF accont from her earnings (Income from other sources, if she is not employed or self employed), that is allowed. But if she is not earning & you are putting the money on her behalf, then you may have a challenge.

  3. bharat shah says:

    further as ppf a/c interest is taxfree, it would not increase to your income.

  4. Vivek says:

    Dear Amit,
    If you don’t mind, may I ask what benefit you will get out of showing the investment under 80C ?
    As she does not have any income, what tax rebate you are expecting ? Sorry, but I am just trying to see if I am missing anything here and I don’t mean to be rude or anything.

    1. Amit Agarwal says:

      Hi Vivek,

      Thanks Vivek for your question. i also had the same question in my mind thats why i posted the query over here. I m showing NIL income for my wife in ITR and thought i would be able to get the rebate of 1Lac under 80c via PPF investment. If i can not get the benefit in case NIL income please let me know how can get the benefit of PPF on her behalf.

      1. bharat shah says:

        as i understand, when you pay to your spouse or minor child ppf a/cs out of your taxable income, you are eligible to avail 80c benefits for your it return ,of course the overall ceiling would apply. On other hand such payment would become the assets of your minor child/spouse and earning on earning would be not clubbed with you. i.e. only interest on a/m gifted would be clubbed with you, but the further interest or any other income would not be clubbed with your income. further on achieving adulthood the child would become a sole owner of such assets, and nothing would be clubbed to your income

  5. Rosh says:

    Dear Joshma,

    NRI’s are not eligible to open PPF account. But if you already have an existing PPF a/c (if someone opens PPF a/c while he/she is resident of india but subsequently becomes NRI then he/she is allowed to continue investing in existing PPF a/c.)

    thanks

    roshan

  6. joshima says:

    Juz to add on to the queries of PPF…!

    3) Can NRI’s open a PPF account?

    Hope you don mind Amit!!

    Regards,

  7. BanyanFA says:

    Hi Amit,
    Congratulations for this thought process. There is nothing to prevent you from doing what you have mentioned in your query. The maturity payout from PPF would be tax free after 15 years. And you can also show the investment in PPF under section 80C.

    regards
    Banyan Financial Advisors (BanyanFA)

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