About the PPF Calculator

The Public Provident Fund (PPF) is a long-term, government-backed savings scheme in India that offers attractive returns and tax benefits. It is a popular choice for individuals looking to build a substantial corpus for retirement, education, or other major life goals. This calculator helps you forecast the maturity value of your PPF account based on your yearly contributions, the interest rate, and the investment tenure.

How is the PPF Maturity Amount Calculated?

PPF interest is compounded annually. The calculation is performed on a year-by-year basis, where the interest earned in one year is added to the principal, and this new balance becomes the principal for the next year. This compounding effect is what leads to significant wealth creation over the long term.

Where:

• P: The annual investment amount.
• i: The rate of interest.
• n: The tenure of the investment in years.

Our calculator performs this calculation iteratively to provide a precise estimate of your future wealth.

Frequently Asked Questions (FAQ)

What is the Public Provident Fund (PPF) Scheme?

PPF is a savings-cum-tax-saving instrument introduced by the National Savings Institute of the Ministry of Finance in 1968. Its primary aim is to mobilize small savings by offering an investment with reasonable returns combined with income tax benefits.

Who is eligible to open a PPF account?

Any resident Indian citizen can open a PPF account. An individual can open only one account in their name. An account can also be opened on behalf of a minor. Non-resident Indians (NRIs) are not eligible to open a new PPF account, but they can continue to contribute to an existing account until its maturity.

What are the investment limits in PPF?

A minimum deposit of **₹500** is required to open and maintain a PPF account. The maximum amount you can deposit in a financial year is **₹1,50,000**.

Is PPF tax-free?

Yes, PPF is one of the few instruments that enjoys the Exempt-Exempt-Exempt (EEE) tax status in India.

• Exempt (Contribution): Investments up to ₹1.5 lakh per year are eligible for tax deduction under Section 80C of the Income Tax Act.
• Exempt (Interest): The interest earned on the PPF balance is completely tax-free.
• Exempt (Maturity): The final maturity amount, including the principal and accumulated interest, is fully exempt from tax.

What is the lock-in period and can I extend it?

The PPF account has a mandatory lock-in period of **15 years**. After maturity, you can extend the account in blocks of **5 years** at a time, with or without making further contributions. This extension can be done for any number of blocks.

Can I take a loan or make a partial withdrawal?

Yes. A loan facility is available from the 3rd to the 6th financial year. Partial withdrawal is permissible from the 7th financial year onwards, subject to certain conditions and limits.