The Public Provident Fund (PPF) is a government-sponsored investing scheme. Because it fits under the EEE (exempt-exempt-exempt) tax category, it is quite popular among investors.
This means that all deposits are tax-free, as are the returns earned and the corpus when withdrawn. If you haven't yet made your tax-saving investments for the year, now is the time to do so.
The PPF has a 15-year lock-in period. You can prolong the lock-in term in 5-year increments once it expires. Parents can also register a PPF account in the names of their minor children and get tax benefits on the deposits.
Assume your parents set up a Public Provident Fund (PPF) account for you when you were still a minor. You've kept the same account and contributed to it for your tax-savings investments since you started working.
What is the procedure for transferring a PPF account?
A person can only have one PPF account at a time.
The procedure is straightforward, however it may take a few weeks. Here's what you need to do:
Apply for the transfer at your existing bank's branch with your PPF passbook.
Please return your old passbook to the bank.
Your PPF account will be closed in the bank's system, and paperwork will be sent to the new bank. These are some of them:
Accountant's certified copy
Form for applying for a new account
Form for Nomination
Your signatures as a sample
The outstanding balance in the form of a check or demand draught
PPF passbook that already exists
Customer's PPF Transfer Request Letter and Bank's Acknowledgement
You'll need to fill out a new account application and attach all of your KYC documents. A new passbook will be issued.
You can link your Savings Account to your PPF account to make it easier to invest in it on a regular basis. Let's have a look at how to do that.
It's the same procedure as adding any other third-party payee.
Add your PPF account number and IFSC code to your net banking account.
Once you've added the account, you can choose to transfer funds digitally.
You can even use an ECS (Electronic Clearing Mandate) to make monthly deposits into your PPF account.
The account balance between the fifth and the end of each month is taken into account for computing interest on the PPF account. As a result, if you want to maximise your profits, make these contributions before the fifth of the month.
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