PPF Calculator

Public Provident Fund (PPF) Calculator

Public Provident Fund (PPF) is one of the most popular and trusted investment schemes in India. Backed by the Government of India, it offers guaranteed returns along with tax benefits. A PPF Calculator helps you estimate the maturity amount and the interest earned on your investment over the tenure of the scheme.

What is PPF?

The Public Provident Fund (PPF) was introduced in 1968 by the Ministry of Finance to mobilize small savings. It is a long-term investment option with a lock-in period of 15 years. PPF is considered a safe investment avenue as it offers fixed returns that are fully exempted from tax.

Key Features of PPF

• Tenure: The minimum tenure is 15 years, which can be extended in blocks of 5 years indefinitely.
• Investment Limit: A minimum of ₹500 and a maximum of ₹1.5 Lakh can be invested in a financial year.
• Interest Rate: The interest rate is determined by the government every quarter. Currently, it hovers around 7.1%.
• Tax Benefits: PPF falls under the Exempt-Exempt-Exempt (EEE) category. The investment amount (under Section 80C), the interest earned, and the maturity amount are all tax-free.

How is PPF Interest Calculated?

Interest on PPF is compounded annually. It is calculated on the lowest balance in your account between the 5th and the last day of every month. Therefore, it is advisable to deposit your contribution before the 5th of the month to maximize returns.

The formula used is: A = P [({(1+i)^n} - 1) / i]
Where A = Maturity Amount, P = Annual Installment, n = Number of Years, i = Rate of Interest.

Disclaimer: This PPF Calculator provides estimates based on the current interest rate. Interest rates are subject to change quarterly by the government. The actual maturity amount may vary slightly.