PPF Calculator: A Public Provident Fund (PPF) account is a risk-free investment and tax-saving instrument backed by the central government. This small savings scheme offers attractive long-term returns. Currently, the PPF interest rate is 7.1%. The PPF account has a term of 15 years, but can be extended indefinitely in blocks of 5 years. This makes it an excellent option for building a retirement corpus.
When you invest ₹12,500 per month in a Public Provident Fund (PPF), you would have a substantial corpus of almost ₹41 lakh during the investment period.
PPF calculator This is how it works
An investor can contribute minimally ₹500 and maximum ₹1.5 lakh within a financial year. Contributions can only be made once a month.
Monthly investment: ₹12,500
Investment duration: PPF accounts have a term of 15 years, but you can renew them in blocks of 5 years.
Interest: The current PPF interest rate is approximately 7.1% annually.
However, if the PPF account holder avails the extension benefit and avails the compound benefit for the next 15 years, then he or she can ₹1.5 million in 30 years.
Safety: PPF is backed by the government, making it a safe investment option.
Tax Benefits: The Public Provident Fund scheme is quite popular among taxpayers. A major reason for its popularity is that PPF falls under the exempt-exempt-exempt tax status.
PPF is eligible for the EEA tax regime. Under Section 80C of the IT Act, PPF deposits are tax deductible up to ₹1.5 Lakh per financial year. Moreover, the interest generated from the investment and the PPF maturity amount are also tax-free.
Maturity Amount: At maturity, the entire amount, including interest earned, is tax-free.
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Disclaimer: The views and recommendations made above are those of individual analysts, and not of Mint. We advise investors to contact certified experts before making investment decisions.
