PPF News: The Central Government may not have changed the interest rates of Public Provident Fund (PPF) for the December quarter, but it is still popular among the working people.
PPF News: The Central Government may not have changed the interest rates of Public Provident Fund (PPF) for the December quarter, but it is still popular among the working people. There is a special way of investing in PPF account. If you also invest, then deposit money in the PPF account before the 5th of every month. With this you will get interest for that month also. Let us tell you that the Central Government gives 7.1% interest on the money deposited in PPF account. The central government adds interest money to the PPF account by March 31 every year but it is calculated every month.
If you invest in PPF account before the 5th of every month, your deposit will be considered for interest calculation for that month. However, if you deposit money after the 5th, you will miss out on getting the interest for that month. Therefore, investing in PPF account before the 5th of every month helps you maximize your returns.
Understand in terms of amount
Suppose you have ₹1.5 lakh to invest in your PPF account. If you invest it on April 20, you will not get 7.1% interest (current interest on PPF account) for the entire year because you have missed the April 5 deadline. You will get interest only for 11 months. This means you will earn interest ₹9,762.50 for FY2023-24. If you had invested before April 5, you would have received ₹10,650 as interest. In this way, there will be a loss of ₹ 887.50 in interest on annual basis.
That is to say, investors who intend to invest lump sum in PPF should do it before April 5 to avail maximum interest. If you deposit the monthly installment then deposit it before the 5th of every month. To avail this benefit, there is a chance till today i.e. till 5th October to deposit the monthly installment for the month of October.
PPF and tax benefits
Tax deduction can be claimed under Section 80C under PPF account. A person can claim tax exemption of up to Rs 1.5 lakh on investments made in a year in a PPF account. Let us tell you that this account can be opened with Rs 500. At the same time, you can invest up to Rs 1.5 lakh in a year.
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