Public Provident Fund

Statutory tax-exempt 15-year compounding.

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Next Up Calculators

Companion tools

Bonds

Current yield & YTM for G-Secs and corporate bonds.

Multi-frequency compounding.

Monthly bank RD maturity projector.

NSC

National Savings Certificate 5-yr compounding.

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Verdict

PPF Maturity (tax-free)

₹40.68 L

Triple-EEE: contribution, interest, and maturity all tax-exempt.

Total Invested

₹22.5 L

Tax-Free Gain

₹18.18 L

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Next Up Calculators

Companion tools

Bonds

Current yield & YTM for G-Secs and corporate bonds.

Multi-frequency compounding.

Monthly bank RD maturity projector.

NSC

National Savings Certificate 5-yr compounding.

Back to Home Dashboard

Public Provident Fund — India's Premier Tax-Exempt Long-Term Vehicle

The PPF is among the few investment products globally enjoying the Exempt-Exempt-Exempt (EEE) tax status: contributions qualify for 80C deduction, accruing interest is tax-free, and maturity is tax-free. Combined with sovereign guarantee, this makes it a non-negotiable component of any Indian household debt allocation.

The Math

Each financial year, contribution is added at year-start and the entire balance compounds at the notified rate (reviewed quarterly by the Ministry of Finance). 15-year lock-in, extendable in 5-year blocks. Partial withdrawals allowed from year 7.

Optimisation

Contribute before April 5 to capture full-year interest.
Use as the debt portion in a 60-40 equity-debt portfolio.
Open one in spouse's and minors' names for household-level cap planning.

Frequently Asked Questions

What is the current PPF interest rate?

The PPF rate is reviewed quarterly by the Government of India. The latest published rate is 7.1% per annum (compounded annually). Rates are typically aligned with G-sec yields plus a small spread.

Is PPF interest tax-free?

Yes — PPF enjoys EEE (Exempt-Exempt-Exempt) status: contributions qualify for Section 80C deduction up to ₹1.5 lakh, interest is tax-free, and maturity is tax-free. It is one of the very few remaining EEE instruments in India.

Can I withdraw PPF before 15 years?

Partial withdrawals are allowed from year 7 onwards (up to 50% of balance at end of year 4 prior). Premature closure is allowed only on medical emergency or higher-education grounds after 5 years, with a 1% interest penalty.

Should I max out PPF every year?

Yes if you want guaranteed tax-free 7%+ returns and have unused 80C room. PPF works best as the debt portion of a long-term portfolio. For higher returns invest the residual in equity mutual funds — don't treat PPF as your only retirement vehicle.

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