POSTED BY October 15, 2013 12:12 am COMMENTS (7)ON
1. Please tell me in ppf a/c investment can do one time in a yrs or every month between 1st to 5th.
2. Suppose i deposits Rs 10,000/- every months interest calculated on every month or if i investment one time in a yrs. interest can calculated in a yrs only.
Pls give a example also.
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7 replies on this article “Some Basic Questions regarding PPF account for a starter ?”
Dear Mustafizur, if you are not opting to continue the PPF account, you can withdraw all the corpus in 16th Year itself. With out contributing, you can withdraw 60% of corpus in each passing year after first 15Y.
I had one question on that 15yrs thing. Whatever amount I am accumulating in my PPF for the 15 years, is all of them available for withdrawal after 15th/16th year? Or does it work this way, that whenever I am depositing any amount to my PPF in a year, that amount is available for withdrawal after it’s respective 15th year?
E.g. say if I deposit 50K in Y1, 1L in Y2 & 70K in Y3, at Y16, is amount available for withdrawal=.5+1+.7 +..so on
Or, on Y16, I can withdraw only 50K, on Y17 I can withdraw 1L like this?
For more details on PPF with examples you can go through our article
Understanding Public Provident Fund, PPF
Overview of PPF
You need to deposit a minimum of Rs. 500 per year in a PPF account.
Maximum amount which you can deposit in a PPF account is Rs. 100,000. (Earlier limit was Rs 70,000 it was increased to 1 lakh from 1.12.2011 )
Deposit amounts should be in multiple of Rs. 5.
You can deposit lump sum or multiple installments. However, maximum number of installments in a year can not be more than 12.
The duration for the investment is 15 years. However, the effective period works out to 16 years i.e., the year of opening the account and adding 15 years to it.
PPF works on financial year basis (April 1st – March 31st) and interest is credited only at the end of financial year.
PPF interest is calculated monthly on the lowest balance between the end of the 5th day and last day of month, however the total interest in the year is added back to PPF only at the year-end.
The interest earned in PPF remains fixed for one year and is no longer guaranteed forever. It is actually benchmarked to the 10-year government bond yield and will be 0.25% higher than the average government bond yield. This rate will be declared every year in March-April. The rate announced for FY 2012-2013 is 8.8%.
1) You can deposit in lumpsum or in installments but not more than 12 installments. But the total amount should not be exceeding Rs.1,00,000/- in a year.
2) Interest are compounded annually, but the interest calculation is done every month. If your contribution to the PPF account is credited on or before 5th of that month, then that contribution will bear interest for that month else on the subsequent month.
You can probably go through one of the old post in this site as below-