PPF Account: Learn the steps to activate a dormant PPF account here

PPF Account: Learn the steps to activate a dormant PPF account here

PPF Account: Learn the steps to activate a dormant PPF account here

PPF Account: An annual minimum deposit of Rs. 500 must be made into the PPF account. An account holder's account gets terminated if they fail to make the required minimum investment.

Delhi, New. PPFs, or public provident funds, are popular investment options in India because they provide competitive interest rates, reduce taxes, and carry no risk of losing money. Any Indian may start investing in PPF with Rs 500 yearly. A PPF account may have up to Rs 1.5 lakh deposited in it annually. The PPF account goes dormant after a financial year if Rs 500 is not deposited.

It is vital that the annual mandated amount be paid into the PPF account as closing the account would also prevent the availability of additional PPF advantages. There is no cause to be concerned if the PPF account has been canceled for whatever reason. A closed PPF account is readily reactivable.

This is the account opening procedure.

The account holder must visit the bank or post office where the PPF account was originally created in order to reopen the account. There will be a form to complete out in order to reactivate the account. In addition, you will be required to pay a penalty of Rs 50 each year in addition to the arrears for the years that you failed to deposit the money.

Compute in this manner.

Let's say that your PPF account has been inactive for four years. So you would have to pay arrears of Rs 2000 for four years. You will also be required to pay a penalty of Rs 200, which is payable every year at a rate of Rs 50.

Cons of closing an account:

In some situations, the government permitted the closing of PPF accounts before to their maturity in 2016. These circumstances might include paying for a child's education or the treatment of a serious disease. However, you may only do this after five years of PPF account investment. PPF accounts may also be used for loans. An dormant PPF account is not eligible for any of these advantages. As a result, closing a PPF account should not be permitted.

On a PPF account, tax exemption is offered.

Under section 80C, investments made in PPF are free from taxes. Moreover, neither interest income nor the amount received at maturity are subject to taxation.