PPF Calculator

What is PPF?

The Public Provident Fund (PPF) is a Government of India long-term savings scheme open to all resident individuals (including children, via guardian). It offers a sovereign guarantee, a tax-free return, and qualifies as the safest long-duration debt instrument in any Indian portfolio.

The EEE tax advantage

PPF enjoys the rare Exempt-Exempt-Exempt tax status:

• E1 — contributions qualify for 80C deduction up to ₹1.5L/yr.
• E2 — interest earned each year is fully tax-free.
• E3 — maturity proceeds are tax-free.

Compared to an FD at the same 7%, PPF effectively yields ~10% pre-tax equivalent for someone in the 30% slab — extraordinary for a sovereign-backed instrument.

Key rules to know

• Tenure: 15 years from end of FY of opening. Extendable in 5-year blocks, with or without further contributions.
• Limits: Minimum ₹500/year; maximum ₹1.5L/year (across all PPF accounts in your name + minor accounts).
• Deposit modes: Lumpsum or up to 12 instalments per year.
• Loan: Available from year 3, up to 25% of balance two years prior.
• Partial withdrawal: Allowed from year 7.
• Premature closure: Allowed from year 5 for medical / higher-education / NRI status — with 1% interest penalty.

Deposit timing trick

Interest is calculated on the lowest balance between the 5th and end of each month. So depositing on or before the 5th of April gives you a full year of interest on that contribution. Depositing on the 6th costs you a month of interest. Big savings over 15 years.

PPF vs SIP — not a choice

PPF is debt. Equity SIPs are equity. They belong to different buckets of the same portfolio. A mature plan uses PPF as the safe ballast (debt allocation) and equity SIPs as the growth engine.

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