Investment in PPF is a better option for employed people. The reason for this is that investment in PPF, the interest earned on it and the amount received on completion of the maturity period, all three are completely tax free.
PPF: Public Provident Fund (PPF) is considered to be a better option for the long term. Investment in PPF is completely safe and it also gets the full benefit of tax exemption. This is a better option for the employed people. The reason for this is that investment in PPF, the interest earned on it and the amount received on completion of the maturity period, all three are completely tax free. Since, the investment in PPF is completely protected by the government, hence the risk for the investors is negligible. PPF is a better investment option for Self Employed Professionals and employees not covered under EPFO. Apart from this, people who do not have any organized structure of job or business can choose PPF for long term investment.
PPF matures after 15 years. In such a situation, now the question arises that what to do when PPF matures? Let us know what are the three options you have after PPF maturity.
PPF account can be closed after 15 years
This is an option that can be used for immediate cash needs or financial crunch. To transfer the amount to your savings account, you have to submit the form to the bank or post office which will contain the details of PPF and savings account. Apart from this, the original passbook and canceled cheque will have to be submitted along with the form.
Account can be increased with new contribution
If you don’t need the money immediately, if you want to continue with the account and want to contribute to it, you can use PPF as a tax-saving tool and continue investing in it. You have to apply for extension by submitting an application to the post office or bank before one year of the end of the maturity period. Extensions are provided for a block of five years at a time and can be availed as many times as desired.
Can continue without new contribution
This is the default option in case of maturity of PPF account. So if you do not inform the bank or post office, your account gets extended automatically. However, you cannot contribute any more, the balance amount earns tax-free interest and you can make only one withdrawal per financial year. No paperwork is required for this option.