5 Big Benefits Of PPF Account, Opportunity To Get Bumper Return On Small Savings | 5 Big Benefits Of PPF Account, Opportunity To Get Bumper Return On Small Savings
The big advantage of PPF is that both its investment and savings are tax deductible. Tell us the 5 biggest benefits of a PPF account.
ppf new interest rate
New Delhi: The Public Provident Fund or PPF is considered to be the best tool for investing with savings. This fund is specially designed for those who avoid taking risks in investing. This fund has the potential to generate substantial returns in the long run with low risk. The big advantage of PPF is that both its investment and savings are tax deductible. Tell us the 5 biggest benefits of a PPF account. (5 Big Benefits Of PPF Account, Opportunity To Get Bumper Return On Small Savings)
1 Risk free return guarantee
PPF is supported by the Government of India. So the biggest advantage of PPF is that it is completely risk free. The government also guarantees a return on your investment. What is better is that when it comes time to pay the lenders, even the court cannot issue any decree regarding the funding of this account.
Multiple tax benefits of 2 ppf
The characteristic of PPF is its EEE i.e. exam, exam, exam tax status. This investment in India alone has benefited from a triple e-tax rebate. There is no tax on the Rs 1.5 lakh you deposit in this account. Triple E here means – there is no tax on the money you invest. Interest earned on it is also tax free and the amount received as maturity after 15 years is not taxable. Therefore, PPF is considered to be the most efficient investment in terms of savings tax.
3 Small savings, good income
There are many types of flexibility or discounts depending on how much you have to deposit in PPF. You can also open a PPF account for Rs 100 if you want. A minimum of Rs 500 and a maximum of Rs 1.5 lakh can be deposited every year. If you wish, you can make this investment 12 times a year or you can make a lump sum deposit. Currently, the government is receiving 7.10 per cent interest on PPF. The previous proportion was 7.60 per cent. The interest on this account earns compound interest.
4 Withdrawal of money and loan facility
The lockin period of PPF account is 15 years. That means you can’t withdraw money before then according to the law. But customers can use PPF funds in many ways. After two years you can take out a loan against this fund. Up to 25% of the money deposited after two years can be borrowed. The loan can be taken till the completion of two years (beginning of the third year) and before 6 years. The loan amount has to be repaid in 36 months. 2% more interest will have to be paid on the loan amount than the percentage interest earned on PPF. You can withdraw some money from the fund after completing 7 years.
5 may extend the deposit period
The term of PPF account is 15 years. After this period the account matures. The maturity money can either be taken by the customer or reinvested if desired. The client gets the investment facility after 15 years and after 5 years. This means that the maturity money should be deposited for the next 5 years. Interest will now accrue on any money deposited in this account, maturity amount will be added to this benefit. Thus an investment of a few thousand can be converted into several lakh rupees.
If you want to earn from interest, read this rule of income tax, you will get complete information
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5 Big Benefits Of PPF Account, Opportunity To Get Bumper Return On Small Savings
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