PPF account in SBI: Do you know these amazing features, Income Tax benefits and other important details?

Public Provident Fund (PPF) is considered as one of the best savings instruments to secure a financially sound and stable future. Public Provident Fund (PPF) is an excellent scheme which offers an investment avenue with decent returns coupled with Income Tax benefits. PPF account in SBI is one of the most sought-after savings options for a wealthy life. Here are some of the amazing features, Income Tax benefits and other important details of PPF account in SBI:-

Features

-Investment Limits a minimum of Rs 500.00 subject to a maximum of Rs 1,50,000 per annum may be deposited

-Original duration is 15 years. Thereafter, on application by the subscriber, it can be extended for 1 or more blocks of 5 years each

-The rate of interest is determined by Central Govt. on quarterly basis. At present it is 7.1% per annum

-Loans and withdrawals are permitted depending upon the age of the account and balances as on the specified dates

-Income Tax benefits are available under Sec 88 of IT Act

-Nomination facility is available in the name of one or more persons. The shares of nominees may also be defined by the subscriber

-The account can be transferred to other branches/ other banks or Post Offices and vice versa upon request by the subscriber. The service is free of charges.

Eligibility

-Individuals in their own name as well as on behalf of a minor or a person of unsound mind can open the account at any Branch.

Terms & Conditions

-The subscriber should not deposit more than Rs.1,50,000 per annum as the excess amount will neither earn any interest nor will be eligible for rebate under Income Tax Act. The amount can be deposited in lump sum or in installments

-Interest is calculated on the minimum balance( in PPF Account) between 5th day and end of the month and is paid on 31st March every year

-Interest income is totally exempt from Income Tax. Amount outstanding to the credit is fully exempted from Wealth Tax also

-An account holder shall be allowed premature closure of his account or the account of a minor or person of unsound mind of whom is the guardian on an application to the accounts office in Form-5, on any of the following grounds, namely

i) treatment of life threatening disease of the account holder, his spouse or dependent children or parents, on production of supporting documents and medical reports confirming such disease from treating medical authority

ii) higher education of the account holder, or dependent children on production of documents and fee bills in confirmation of admission in a recognised institute of higher education in India or abroad

iii) on change in residency status of the account holder on production of copy of Passport and visa or Income tax return