PPF For Regular Income: Possible to get Rs 66,000 a month tax-free income?

The Public Provident Fund (PPF) is a long-term savings scheme backed by the government of India, offering tax-free returns. It features a 15-year lock-in period and exemptions under Section 80C of the Income Tax Act. 

Anamika Singh | Jan 20, 2025, 05:05 PM IST

The Public Provident Fund (PPF) is a government savings scheme that helps people save money for the future safely and reliably. It offers a good interest rate, and the money you earn from it is completely tax-free. You can invest up to Rs 1.5 lakh a year, and this amount also helps you save on taxes. The money is locked in for 15 years, but you can extend it for 5 years at a time if needed. PPF is a great option for anyone looking to grow their savings without taking any risks. Therefore, let’s find out if is it possible to get Rs 66,000/month tax-free income.

Photos source: Pixabay/Representational

(Disclaimer: Our calculations are projections and not investment advice. Do your due diligence or consult an expert for financial planning)

Read more: PPF For Regular Income: How to plan for over Rs 75,000 a month tax-free income from Public Provident Fund?

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What is Public Provident Fund?

What is Public Provident Fund?

PPF is a retirement-centric scheme that investors also use for their portfolio diversification. One can open a PPF account in a bank or post office. It also offers guaranteed returns and tax benefits under Section 80C of the Income Tax Act, 1961, to individuals. 

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What is maturity period of PPF account?

What is maturity period of PPF account?

The maturity period is 15 years. After 15 years, the account holders can extend the account for unlimited blocks of 5 years each. 

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What is minimum and maximum PPF investment?

What is minimum and maximum PPF investment?

The minimum deposit in a financial year is 500, whereas the is Rs 1.5 lakh.

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Tax benefits in PPF

Tax benefits in PPF

Contributions up to Rs 1.5 lakh in PPF are eligible for tax deductions under Section 80C, the interest earned and the corpus are also tax-free.

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Can you withdraw PPF amount before maturity period of 15 years?

Can you withdraw PPF amount before maturity period of 15 years?

A PPF account holder is allowed to take 1 withdrawal during a financial year after 5 years, please note it does include the year of account opening. (if the account is open during 2023-24, the withdrawal can be taken during or after 2029-30).

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How much can you withdraw at end of preceding year?

How much can you withdraw at end of preceding year?

you can withdraw up to 50 per cent of the balance at the credit at the end of the 4th preceding year or at the end of the preceding year, whichever is lower. (i.e., withdrawal can be taken in 2023-24, up to 50% of the balance as of 31.03.2023 or 31.03.2023, whichever is lower).

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What happens to PPF account after 15 years?

What happens to PPF account after 15 years?

After 15 years of the maturity period, investors can continue their accounts with or without deposits. 

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How to get Rs 66,000 income a month from PPF?

How to get Rs 66,000 income a month from PPF?

To generate Rs 66,000 a month from PPF one has to begin with Rs 1.50 lakh investment every financial year and continue it till the maturity period of 15 years. To get the maximum benefit of interest, the investment should be made between April 1-5 every financial year. 

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What will be PPF corpus after 15 years?

What will be PPF corpus after 15 years?

The investment amount in 15 years will be Rs 22,50,000, the estimated interest will be Rs 18,18,209, and the estimated maturity will be Rs 40,68,209. The investor can take an extension of 5 years and keep investing Rs 1.50 lakh a year in the same way as before.

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What will be PPF corpus after 20 years?

What will be PPF corpus after 20 years?

In 20 years, the total investment will be Rs 30,00,000, the estimated interest will be Rs 36,58,288, and the estimated corpus will be Rs 66,58,288. At this stage, the investor can take another extension of 5 years and continue the practice of investing Rs 1.50 lakh a year. 

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What will be PPF corpus after 26 years?

What will be PPF corpus after 26 years?

In 26 years, the total investment will be Rs 39,00,000, the estimated interest will be Rs 73,00,534, and the estimated corpus will be Rs 1,12,00,534.

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What is next step after 26 years of investment?

What is next step after 26 years of investment?

From here onwards, investors can start withdrawing interest on the entire corpus. During extensions, the account holder is allowed to withdraw the interest amount once a year.  

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What will be your interest amount?

What will be your interest amount?

At a 7.1 per cent interest rate, the interest in a year will be Rs 9,33,377, which will be equal to Rs 66,269 a month.

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