PPF calculator: maturity value at 7.1% with yearly deposits

How PPF interest works

Interest is worked out each month on the lowest balance between the 5th and the end of the month, and added to the account once a year. This calculator assumes you deposit by 5 April each year, so every deposit earns interest for the full year. If you deposit later in the year you earn a little less.

The account runs for 15 full financial years. After that you can extend it in blocks of 5 years, with or without new deposits, by applying within a year of maturity.

Tax

PPF is exempt at all three stages. Deposits count towards the ₹1.5 lakh deduction under the old tax regime (section 123 of the new Act, formerly 80C), and the interest and the maturity amount are tax free under both regimes.

Getting money out early

From the 7th financial year you can withdraw once a year, up to half of an earlier balance.
From the 3rd to the 6th year you can take a loan of up to 25% of the balance two years earlier.
Early closure is allowed after 5 years for set reasons, such as medical treatment or higher education, with 1% less interest.

Questions

Can the PPF rate change during my 15 years?

Yes. The government sets it every quarter, and the new rate applies to your whole balance from then on. This calculator uses one rate throughout.

Is ₹1.5 lakh the limit across all my PPF accounts?

Yes. One person can hold only one PPF account, and ₹1.5 lakh a year is the most you can put in, including deposits in a minor child's account you manage.

Which is better, PPF or an FD?

PPF interest is tax free and the rate is usually higher, but the money is locked for 15 years. FD interest is taxed at your slab rate, but you can choose any term. Compare them with the FD calculator.

Sources

For illustration only. The rate can change every quarter. Check the current rate with your bank or post office.