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Power of Rs 1,50,000 PPF Investment: How many years will it take to generate over Rs 18 lakh/year tax-free income from Public Provident Fund?
- Written by Anamika Singh
Published: Zee Business| Updated: Zee Business
Investing in a Public Provident Fund (PPF) account comes with appealing tax advantages. You can claim tax deductions under Section 80C for contributions up to Rs 1.5 lakh annually. Moreover, both the interest earned and the maturity amount are entirely tax-free. As a government-backed scheme in India, PPF currently offers an annualised return of 7.1 per cent. On that note, let’s find out how you can generate over Rs 18 lakh/year tax-free income from the Public Provident Fund.
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1/8
How to get over Rs 18 lakh/year income from PPF?
1/8To generate over Rs 18 lakh/year from PPF, one has to begin with a Rs 1.50 lakh investment every year and continue it till the maturity period of 15 years. Later, you can extend the account for unlimited blocks of 5 years each for maximum return.
2/8
What will be PPF corpus after 15 years?
2/8The 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.
3/8
What will be PPF corpus after 20 years?
3/8In 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.
4/8
What will be PPF corpus after 25 years?
4/8In 25 years, the total investment will be Rs 37,50,000, the estimated interest will be Rs 65,58,015, and the estimated corpus will be Rs 1,03,08,015.
5/8
What will be PPF corpus after 30 years?
5/8In 30 years, the total investment will be Rs 45,00,000, the estimated interest amount will be Rs 1,09,50,911, and the estimated corpus will be Rs 1,54,50,911.
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What will be PPF corpus after 35 years?
6/8In 35 years, the total investment will be Rs 52,50,000, the estimated interest amount will be Rs 1,74,47,857, and the estimated maturity amount will be Rs 2,26,97,857.
7/8
What is next step after 35 years of investment?
7/8From here onwards, account holders can start withdrawing interest on the entire corpus. During extensions, the account holder is allowed to withdraw the interest amount once a year.
8/8
What will be your interest amount?
8/8At a 7.1 per cent interest rate, the interest in a year will be Rs 18,91,488.
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