India Post or Department of Posts, the postal system of the country, provides a number of services. India Post, which has a network of over 1.5 lakh post offices across the country, offers several savings schemes with different interest rates. Interest rates on post office saving schemes move in line with the government's interest rates on small savings schemes, which are revised on a quarterly basis. One such savings scheme offered by post office is 15-year Public Provident Fund (PPF) Account, according to its official website, indiapost.gov.in.
Here are 10 key things to know about post office public provident fund (PPF) account:
1. A post office PPF account can be opened by cash or cheque.
2. In case the account is opened by cheque, the date of realisation of cheque in government's account shall be date of opening of account. One can also open a joint account.
3. An investor needs a minimum of Rs 100 to open the account but has to deposit Rs. 500 in a financial year.
4. The maximum limit in a financial year is Rs. 1,50,000, according to India Post. Deposits can be made in lump-sum or in 12 installments.
5. The public provident fund account offers an interest of 8 per cent per annum, which is compounded yearly, noted India Post.
6. Investment made under PPF account also qualifies for income tax benefits under Section 80C of the Income Tax Act, 1961. Interest earned is also tax-free, according to India Post.
7. A PPF subscriber cannot close the account before completing the 15-year period.
8. However, the tenure can be extended within one year of maturity for further five years and so on.
9. Premature withdrawal is permissible every year from seventh financial year from the year of opening account.
10. The account also offers loan facility from third financial year and nomination facility is available at the time of opening and also after opening of account.