PPF Calculator (Public Provident Fund)

15-Year Sovereign Guaranteed Growth & 100% Tax-Free Returns

PPF Rules: Sovereign guarantee. Lock-in period of 15 years. Maximum investment ₹1.5 Lakh per financial year. EEE Tax Status (Exempt-Exempt-Exempt). Current Interest Rate: 7.1% (Compounded Annually).
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Max ₹1,50,000 per year allowed.

Min 15 years. Extendable in blocks of 5 years.

7.1% (Fixed)

Tax-Free Maturity Amount

₹0

Total Invested

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Total Interest Earned

₹0

💡 Why Do You Need This Calculator?

Introduced way back in 1968, the Public Provident Fund (PPF) has stood the test of time as one of India's most beloved and secure wealth-building instruments. Backed entirely by a sovereign guarantee, it offers unparalleled financial safety in an unpredictable world. You need the PPF Calculator because managing a strict 15-year lock-in period alongside a ₹1.5 Lakh annual investment cap requires long-term, disciplined foresight.

The true, unrivaled magic of PPF lies in its EEE (Exempt-Exempt-Exempt) tax status—meaning your deposits, your accumulated interest, and your final massive maturity amount are all completely exempt from income tax. You need this calculator to visualize the incredible snowball effect of compounding over 15 to 30 years. It helps you realize mathematically that consistently maxing out your PPF deposits year after year can create a multi-crore, completely tax-free corpus. This allows you to aggressively shield a significant portion of your net worth from both market volatility and heavy taxation.

📖 How to Use & Calculation Guide

Public Provident Fund (PPF)

How to use: Enter your initial lumpsum investment and your planned yearly deposit. Note that the maximum legal deposit per financial year is ₹1,50,000. Set your duration using the slider (minimum lock-in period is 15 years, extendable in blocks of 5).

Calculation Details: Compound interest is calculated annually at the fixed government rate of 7.1%. The formula applied is Balance = Previous Balance + Yearly Deposit + Interest. PPF enjoys EEE (Exempt-Exempt-Exempt) tax status, meaning the entire maturity amount and interest earned are completely tax-free.

Sovereign Fixed Income

Public Provident Fund (PPF): The Sovereign Gold Standard of Indian Savings

First introduced in 1968 by the National Savings Institute of the Ministry of Finance, the Public Provident Fund (PPF) remains the premier fixed-income wealth preservation instrument for conservative Indian households. Backed by an unconditional sovereign guarantee, PPF combines capital safety with compounding interest and the coveted Exempt-Exempt-Exempt (EEE) tax status.

Whether you are building a child's higher education corpus or cementing the fixed-income portion of your retirement portfolio, mastering the operational rules of PPF ensures maximum compounding efficiency.

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💡 The Critical "5th-of-the-Month" Compounding Rule

The single most common mistake made by PPF subscribers is timing their deposits incorrectly. Under statutory rules:

The Rule: Interest is calculated every month on the minimum balance standing in the account between the close of the 5th day and the end of the month.

The Strategy: Always transfer your monthly PPF installment on or before the 5th of the month. If you deposit funds on the 6th, that deposit earns zero interest for the current month!

Lump Sum Hack: If depositing the full annual limit of ₹1,50,000 as a lump sum, deposit it between April 1st and April 5th to earn interest for all 12 months of the financial year!

📈 15-Year PPF Compounding Schedule: ₹1,50,000 Annual Deposit (at 7.1%)

Year Opening Balance Deposit (₹) Interest Earned (7.1%) Closing Balance
Year 1₹0₹1,50,000₹10,650₹1,60,650
Year 3₹3,32,706₹1,50,000₹34,272₹5,16,978
Year 5₹7,25,972₹1,50,000₹62,194₹9,38,166
Year 7 (Partial W/D starts)₹11,83,722₹1,50,000₹94,694₹14,28,416
Year 10₹20,01,173₹1,50,000₹1,52,733₹23,03,906
Year 12₹26,62,497₹1,50,000₹1,99,687₹30,12,184
Year 15 (Maturity)₹38,01,638₹1,50,000₹2,80,571₹40,68,209
Total Principal Deposited ₹22,50,000
Total Tax-Free Interest Earned ₹18,18,209
Total 15-Year Maturity Payout ₹40,68,209 (100% Tax-Free)
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🔄 The 1 Crore Milestone: Extending in 5-Year Blocks

The real magic of compounding occurs after Year 15. By extending your PPF in 5-year blocks with continued deposits:

20-Year Milestone (1 Block Extension)

Total Invested: ₹30,00,000 | Interest Earned: ₹36,58,000

Corpus: ₹66,58,288

25-Year Milestone (2 Block Extensions)

Total Invested: ₹37,50,000 | Interest Earned: ₹65,58,000

Corpus: ₹1,03,08,015 (₹1+ Crore Tax-Free!)
Knowledge Base

❓ Frequently Asked Questions (FAQs)

What is the Public Provident Fund (PPF) and what is the current interest rate?

The Public Provident Fund (PPF) is a statutory, government-backed small savings scheme established under the Public Provident Fund Act (now governed by Government Savings Promotion Rules). The interest rate is reviewed and notified quarterly by the Ministry of Finance, Government of India. The current interest rate is 7.1% per annum, compounded annually.

What is the critical '5th of the month' deposit rule in PPF?

Under official PPF rules, interest is calculated on the lowest balance standing to the credit of the account between the close of the 5th day and the end of the calendar month. Therefore, if you deposit funds on or before the 5th of the month, you earn interest for that full month. If deposited on the 6th or later, you lose out on interest for that entire month.

What is the Exempt-Exempt-Exempt (EEE) tax status enjoyed by PPF?

PPF is one of the very few financial instruments in India enjoying pure EEE status: 1) Contributions qualify for tax deduction under Section 80C up to ₹1.5 Lakhs. 2) The annual compounding interest accrued is 100% tax-free under Section 10(11). 3) The entire final maturity corpus withdrawn after 15 years is completely free from income tax.

Can I extend my PPF account after the mandatory 15-year tenure completes?

Yes. Upon maturity at the end of 15 years, a subscriber can extend their account indefinitely in blocks of 5 years. You have two choices: 1) Extension with fresh contributions (by submitting Form H within one year of maturity), or 2) Extension without contributions, where the balance continues earning interest and you can withdraw up to 100% anytime.

What are the rules regarding loans against a PPF balance?

A subscriber can avail a loan against their PPF balance from the 3rd financial year up to the end of the 6th financial year. The loan amount is capped at 25% of the credit balance at the end of the second financial year preceding the year in which the loan is applied for. The interest charged is exactly 1% per annum above the prevailing PPF rate.

When can partial withdrawals be made from a PPF account?

Partial withdrawals are permitted once every financial year starting from the 7th financial year onwards. The maximum withdrawal amount is limited to 50% of the balance at the end of the 4th preceding year, or 50% of the balance at the end of the immediately preceding year, whichever is lower.

Can a PPF account balance be attached by a court decree for debts?

No. Under Section 15 of the Government Savings Promotion Act, a PPF account balance cannot be attached by any court decree in respect of any debt or liability incurred by the subscriber. However, it can be attached by Income Tax authorities for tax dues.

What happens if I miss the minimum annual deposit of ₹500 in PPF?

If the minimum deposit of ₹500 is not paid in any financial year, the account becomes inactive or discontinued. It can be revived at any time before maturity by paying a default fee of ₹50 for each lapsed year along with the minimum deposit of ₹500 for each arrears year.