PPF account maturity: What are the choices obtainable as soon as your Public Provident Fund matures? – Occasions of India

Public Provident Fund: The Public Provident Fund (PPF) is fashionable due to its engaging. rates of interest and tax advantages, particularly for small savers. You may deposit as little as Rs 500 or as much as Rs 1.5 lakh yearly in a PPF account.
PPF offers tax exemption below part 80C of the Revenue Tax Actand its returns aren’t taxable, making it a superior funding choice in comparison with many others.Furthermore, you possibly can go for a Mortgage In opposition to PPFwhich offers loans towards your PPF steadiness at a aggressive rate of interest throughout monetary emergencies.
Whereas your PPF account is lively, you’ve got the flexibleness to borrow cash towards it or make partial withdrawals, regardless of its 15-year lock-in interval. Nevertheless, as soon as it reaches maturity, what choices can be found?
You’ve three options to proceed as soon as your PPF account matures,
a) Shut the account and withdraw all the proceeds.
b) Prolong the account with out making contemporary deposits.
c) Prolong the account with contemporary deposits.
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1. Shut the account and withdraw total proceeds

You may solely shut a PPF account after 15 years from the tip of the yr during which you first subscribed to it. As soon as your account matures, you possibly can withdraw all the corpus.
To do that, you’ll want to submit a completely stuffed Type C on the financial institution department or publish workplace the place your PPF account is held. After processing, the corpus will probably be credited to your checking account, and the PPF account will probably be closed. In some banks, Type 2 is used as an alternative of Type C.

2. Prolong the account with out contemporary deposits

After your PPF account matures, you’ve got the choice to increase it in five-year intervals indefinitely. Throughout this prolonged interval, you are not required to make new deposits, however you possibly can nonetheless make partial withdrawals, topic to sure situations. Nevertheless, extra contributions will not be accepted. The steadiness will proceed to earn curiosity for the subsequent 5 years. You are allowed to make one partial withdrawal per fiscal yr throughout this time. Any quantity within the steadiness might be withdrawn as soon as per fiscal yr by the subscriber. It is essential to notice that in the event you proceed the account with out deposits for greater than a yr, you can not choose ​​to renew contributions for a subsequent five-year block.

3. Prolong the account with contemporary deposits

To proceed utilizing your PPF account and make new contributions after the tip of the maturity interval, you will need to notify the Account Workplace earlier than the yr ends by finishing Type H. Should you proceed to deposit with out submitting this way, any additional deposits will probably be thought of irregular. , and no curiosity will probably be paid on them. Moreover, deposits made into PPF accounts after the 15-year window with out selecting to maintain the account open won’t qualify for the tax advantages offered by Part 80C of the revenue tax Act.
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Partial withdrawals throughout extension interval

Should you select to increase your PPF account with out contributing, you possibly can withdraw any quantity out of your steadiness as soon as per fiscal yr, whereas nonetheless incomes curiosity on the remaining steadiness.
However, in the event you resolve to increase the account with a contribution, you are allowed just one partial withdrawal throughout the extension interval. To do that, you’ll want to submit a Type C utility. Nevertheless, there is a situation: the overall withdrawals made throughout the five-year block interval can’t exceed 60% of the credit score steadiness in the beginning of the prolonged interval.
You’ve flexibility in the way you withdraw this quantity—you possibly can take it unexpectedly in a single yr or unfold it out over a number of years to fit your wants. Equally, throughout the subsequent five-year block interval, you possibly can withdraw as much as 60% of the overall quantity at credit score in the beginning of that interval, however not more than as soon as per yr. This withdrawal restrict applies at the beginning of every five-year block extension.