Reporting PPF Fund: How to pull money from PPF? How to close PPF account?

Withdrawal of PPF funds: With the gradual fall of interest rates, public interest in public provident funds (PPF) has decreased over years. Currently 7.1% interest on PPF deposit. In addition, many investors still prefer it due to tax benefits, government -security security and stability as debt investment. Despite the maturity of 15 -year for PPF, funds can be withdrawn from the account before maturity. However, it has some terms and conditions.

Loans on PPF

To qualify for loans on PPF, you will have to wait by that financial year to the end of the next financial year. That is, loan on PPF from the beginning of the third financial year. 25%of the remaining amount at the end of the financial year before the year applied to the loan. This means that if you want to borrow on 31 March 2025, by the end of 31 March 2023, only 25% balance will be a loan. The loan window will only be available from the end of the year to five financial years that you have opened the account. Next, partial withdrawal from your PPF account can be done.

Interest, repayment

Interest on PPF loan will be charged by PPF interest rate + 1 %. PPF loans can be repaid within 36 months. Once the original is paid (in installments or united), the borrower can pay the rest of the interest which is not more than two installments. If the loan is not repaid within 36 months, the interest rate will increase + 6%. If the original payment is made within 36 months and the interest is yet to be paid, the outstanding interest can be recovered from the PPF account. To get a loan facility, you have to submit Form 2 in your branch.

PPF with draw

Since the end of the financial year of PPF account you can partially withdraw cash from the PPF account since the end of five full financial years. If you can withdraw maximum then either of the following is low. They are 50% (withdrawal from the year) at the end of the previous year or 50% of the balance at the end of the fourth year. Let’s see an example. If you want to withdraw on 31 March 2025, then the closing balance of the previous year (31 March 2024) is considered to be 50% or the fourth year closing balance (on 31 March 2021). Among them, balance of Rs 5 lakh at the end of the year and Rs. balance of. 50%of 4 lakhs, ie Rs. 2 lakhs can be withdrawn. This partial withdrawal facility can be obtained once every financial year. There is no tax burden on these withdrawal. To partially withdrawn, you have to submit Form 2 in your branch.

After maturity

After 15 years of maturity, the PPF accountant is likely to expand five years of accounts. Can expand the account with or without contribution. If an account holder decides to do so without contribution, there is no limit, any amount can be withdrawn. However, only such return can be made in a financial year. A tax and investment expert Balwant Jain said, “If the account holder decides to expand the account with contribution, the maximum withdrawal limit in the initial balance will be 60%at the beginning of the extended five years.” In both cases, interest is deposited at the current PPF rate.

PPF account closure in advance

PPF account can be closed in advance under special circumstances, such as a life -related disease for themselves, or a spouse or dependence, such as treatment of disease, higher education or residential state of self or dependent children. However, the account holder will have to complete at least five financial years since the end of the financial year. However, pre -close is fined. This will reduce the current PPF interest rate by 1 % per year. The last amount is adjusted accordingly. You have to submit Form 5 for Pre -Close. If the customer dies, the waiting period of five years does not apply. You can immediately close the account. In such cases, 1 percent of guilt does not apply.