Tips For Maximising Benefits And Returns in PPF

  • PPF tipsPPF tips

    Invest by the 5th of the month

  • Tax rebate can be availed of by investing even in the 16th year
  • Post-Maturity continuation
  • Can be self-funding after year 7
  • Interest in your PPF account is calculated on the lowest balance between the close of the fifth day and the last day of every month and is credited to the account at the end of each financial year i.e., on 31st March. So if you invest by the 5th of the month, you will be eligible to interest for the full month in which you are investing.
  • Although, PPF is theoretically a 15-year scheme, you can make your last contribution to PPF till the last day of the 16th financial year. Your contribution to PPF on the last day of the 16th year may not get any interest, but you can claim a tax-rebate on the investment amount.
  • You could choose to extend your PPF account for a period of five years at a time, after the completion of its 15-year term. Such an extension is recommended for individuals who do not need this entire amount, nor have a better investment option.
  • If you choose to extend your account, you must submit Form H if you want to claim section 80C tax benefits on fresh contributions. If you merely retain the balance in your account, without submitting Form H, you will continue to earn 8% p.a. tax-free interest until it is withdrawn.
  • If you continue with fresh subscriptions, you are entitled to withdraw upto 60% of your balance at the beginning of each extended period in one or more installments, but not more than once a year.
  • If you merely retain the balance in your account, you can withdraw the entire sum in one, or more, installments, but again, but not more than once a year.
  • The partial withdrawal facility of the PPF scheme enables you to derive the benefits of section 80C without investing any fresh capital.
  • Assuming you have decided to invest a fixed amount in PPF every year, from the 7th year onwards you can withdraw an amount equivalent to your annual investment from your accrued PPF account, and deposit the same back as your contribution for that particular year.  

Interest Rates & Premature Encashment of National Savings Certificate

Interest Rate

Period during which purchased  

Maturity Value for a Denomination of      INR 100.00    

From   To  
  01.01.1999   14.01.2000   INR 195.60
15.01.2000 28.02.2001   INR 190.12  
01.03.2001 28.02.2002   INR 174.52  
01.03.2002 28.02.2003   INR 169.59  
01.03.2003 onwards   INR 160.10  


One person can be nominated for certificates of denomination of INR  100 and more  than one person can be nominated for higher denominations.  

  Maturity period is 6 years.No premature encashment is permitted in thenormal course.   

PREMATURE ENCASHMENT under sub-rule (1) of rule 16 after the expiry of  three years from the date of purchase of certificate.  Table below for a certificate of INR 100 denomination and at a proportionate rate for a certificate of any other denomination.


Period from the date of the certificate to the date of its encashment.

Issued  from 01.03.2001 to 28.02.2002

Issued  from 01.03.2002 to 28.02.2003




Three years or more, but less than three years and six months








Three years and six months or more, but less than four years 








Four years or more, but less than four years and six months.








Four years and six months or more, but less than five years 








Five years or more, but less than five years and six months.








Five years and six months or more, but less than six years