Public Provident Fund Scheme was introduced by the Government of India on July 1, 1968 and it provides the depositor the twin benefits of attractive return and tax benefit. The Scheme is operational in all branches of PNB.
Do you want to open a Public Provident Fund (PPF) account? Here is an important information for you. You can now open a PPF account with Punjab National Bank (PNB) and get attractive returns and tax rebates.
“Open a PPF account and get attractive returns as well as tax rebates,” PNB said in a tweet.
People can know that Public Provident Fund Scheme was introduced by the Government of India on July 1, 1968 and it provides the depositor the twin benefits of attractive return and tax benefit. The Scheme is operational in all branches of PNB.
If you are willing to open a PPF account, then you can check the details provided below:
Resident Individual in his/her own name and as guardian of a minor or a person of unsound mind can open the account.
PPF Account cannot be opened in joint names.
Non Resident Indians (NRIs) cannot open PPF account w.e.f. 25.07.2003
HUFs cannot open PPF account w.e.f. 13.05.2005.
Accounts opened by NRIs and HUFs prior to above mentioned dates will continue till maturity. Thereafter no extension is allowed and no interest is payable on HUF and NRI PPF Accounts.
Only one account can be opened by an individual in one name. Second PPF Account opened in contravention of PPF Rule will be treated as irregular account and will be closed and will not carry any interest.
Opening of accounts
PPF account can be opened in any branch of PNB. PPF account cab also be opened by IBS Retail user by using Internet banking services.
The account can be opened with a minimum initial deposit of Rs 500 and thereafter deposit of any sum in multiple of Rs 50 can be made subject to not more than Rs 1,50,000 in an account during a F.Y in one lump sum or in installments.
Maximum limit of Rs 1,50,000 by an individual, shall be inclusive of the deposits made in his own account and in the account opened on behalf of the minor. The total deposit in a year as specified, shall be inclusive of deposits made in respect of years of default of the preceding years but excluding the default fee.
The account is of 15 years duration and the account can be extended for one or more blocks of 5 years without loss of interest on written request within 1 year from the date of maturity.
Interest on PPF is payable as per Government of India, Ministry of Finance Gazette Notification issued in each quarter.
Loans and Withdrawals
The depositor is eligible for a loan. The first loan can be taken in the third financial year from the financial year in which the account was opened up to 25 percent of the amount at the credit at the end of first financial year.
The principal amount of loan shall be repaid by the account holder before the expiry of thirty six months from the first day of the month following the month in which the loan is sanctioned.
The repayment of the loan can be made either in lump sum or in installments. After the principal amount of the loan is fully repaid, the account holder shall pay interest thereon in not more than two monthly installments at the rate of one percent, Per annum of the principal for the period commencing from the first day of the month following the month in which the loan is drawn up to the last day of the month in which the last instalment of the loan is repaid.
Where the loan is not repaid or is repaid only in part, within a period of 36 months, interest on the amount of loan outstanding shall be charged at six per cent per annum instead of at one percent, per annum with effect from the first day of the month following the month in which the loan was obtained to the last day of the month in which the loan is finally repaid.
Any time after the expiry of five years from the end of the year in which the account was opened, the account holder may, avail withdrawal by applying in Form-2, (Annexure-II) from the balance to his credit, an amount not exceeding fifty per cent of the amount that stood to his credit at the end of the fourth year immediately preceding the year of withdrawal or at the end of the preceding year, whichever is lower: Facility of partial withdrawal shall also be available to the account extended subject to the condition that the total withdrawal during the block period of five years shall not exceed sixty per cent of the balance at credit at the commencement of the block period subject to the ceiling as specified above may be made either in a single or in yearly instalments.
Presently, the subscriptions to the account qualify for deduction under Section 80 C of IT Act. The interest credited to the account is totally exempt from Income Tax. The amount standing to the credit of the account is fully exempted from Wealth Tax.