How PPF Calculator Works
Public Provident Fund (PPF) is a long-term, government-backed savings scheme with EEE (Exempt-Exempt-Exempt) tax status. Minimum 15-year tenure, can extend in blocks of 5 years. Annual investment ₹500 to ₹1.5 lakh. Current interest rate 7.10% (revised quarterly).
PPF Maturity Formula (yearly compounding):
F = P × {[(1+i)^n - 1] / i} × (1+i)
F = Maturity value
P = Annual investment
i = Interest rate (decimal)
n = Tenure in years
Example Calculation
PPF: ₹1.5L per year for 15 years at 7.10%
Total Invested = ₹1.5L × 15 = ₹22.5L
Maturity ≈ ₹40.68 lakh
Interest earned = ₹18.18 lakh (tax-free!)
PPF Key Features
| Feature | Details |
|---|
| Eligibility | Only resident Indians (not NRIs) |
| Min Investment | ₹500/year |
| Max Investment | ₹1,50,000/year |
| Lock-in | 15 years (extendable 5 years) |
| Interest Rate | 7.10% (quarterly revised) |
| Compounding | Yearly |
| Tax Status | EEE (Exempt-Exempt-Exempt) |
| 80C Deduction | Up to ₹1.5L |
| Loan Facility | From 3rd to 6th year (max 25% of balance) |
| Partial Withdrawal | From 7th year onwards |
PPF vs EPF vs NPS - Quick Compare
| PPF | EPF | NPS |
|---|
| Rate | 7.10% | 8.25% | 9-12% |
| Tax Status | EEE | EEE | EET (60% tax-free) |
| Lock-in | 15 years | Till retirement | Till age 60 |
| Max/year | ₹1.5L | No limit | No limit |
| Risk | Zero (govt) | Zero (govt) | Market-linked |
Smart PPF Tips
- Invest by April 5: Interest is calculated on minimum balance between 5th and end of month. Investing early ensures full year interest
- Lump sum vs Monthly: Lump sum on April 1st gives maximum interest. If monthly, do before 5th
- Open in Post Office: Slightly faster servicing than banks
- Joint PPF for spouse: Maximize family ₹1.5L × 2 = ₹3L combined contribution
- Don't withdraw early: Power of compounding strongest in last 5 years
FAQs
Q: Can NRIs open PPF?
No, NRIs cannot open new PPF. Existing PPF accounts (opened as resident) continue till maturity but cannot extend after.
Q: PPF account for minor child?
Yes, parents can open PPF for minor. But combined limit ₹1.5L applies per individual including all PPF accounts.
Q: When is PPF interest credited?
PPF interest is calculated monthly but credited at the end of every financial year (March 31).
Q: How to extend PPF after 15 years?
Submit Form H within 1 year of maturity to extend by 5 years. Can do this multiple times. With extension, you can withdraw 60% of balance available at start of extension period.