Public Provident Fund (PPF) is a better investment option for the long term. Investing in PPF is not only safe but also offers the full benefit of tax exemption. For investors, the risk is negligible. Since investment in PPF is fully protected by the government, it is completely risk-free. PPF is one of the most suitable investment options for self-employed professionals and employees not covered by EPFO. Apart from this, people who do not have any organized structure for jobs or business can choose PPF for long term investment.
Another reason why PPF is a better option for most employed people is that PPF is completely tax-free after maturity. PPF matures after 15 years. Now the question arises that what should you do when PPF matures? Let us tell you about three options that you can use when PPF matures.
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Close account maturity
Interest is not paid continuously in PPF account, but it keeps adding to your PPF account. When you withdraw money, you get the principal and interest, but there is no tax on this amount. 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. The original passbook and cancellation check have to be submitted along with the signed form.
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Accounts can be deposited and increased
Remember that if you want to increase your account after PPF matches, then you have to fill in Form H. Keep in mind that to increase PPF account, you have to fill Form H within a year. It is for a period of five years and you can do it any number of times according to yourself.
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Continuing without the new contribution
This option is the default in PPF. If you do not remove it after PPF maturity or do not choose any other option, then your PPF maturity date automatically increases for five years. If you want, you can also take PPF Maturity Actions as per your wish. No paperwork is required for this.
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