- 25% of the amount deposited to the account holder
- You can withdraw funds up to 50% from PPF account after five years Avail loans on PPF account
Public Provident Fund (PPF) is considered the most suitable tax saving investment option avail loans on PPF account, which gives financial strength to your retirement plan. You can withdraw money even before the maturity period of PPF account. Not only this, after one year of opening the account, there is also a facility to take a loan on it. The first subscription to take a loan on PPF account is one year old. For example, if you have opened the account between April 1, 2016 to March 31, 2017, then the loan application can be made anytime after April 1, 2018.
A loan can be taken by the account holder up to 25 per cent of the total money deposited by the beginning of the second financial year. However, it is very important to know that after opening a PPF account, the loan can be applied for up to five financial years.
That is, if you have opened an account in FY 2016-17 and you start getting loan facility from 2018-19, then application can be made by 2022-23.
Will have to pay two percent interest
Interest will not be paid on the amount withdrawn from the PPF account as a loan, rather it will have to pay interest at the rate of two per cent per annum. It has to be kept in mind that the loan amount along with interest will have to be paid within 36 months of the month in which you have taken interest on PPF account.
If you fail to pay within this period, a penalty of six per cent per annum will be paid on this amount. First you have to repay the loan amount, after that you have to pay interest. If interest is not paid, it will be deducted from PPF account.
Avail loans on PPF account amount can be withdrawn after five years
After five years of opening a PPF account, you will not get the facility to take a loan on it. However, after this period, the account holder can withdraw 50% of the total deposit. If there is any outstanding loan amount for this period, the amount withdrawn by the account holder is deducted and the balance is paid off. To withdraw funds from the account, it is necessary that the amount is deposited regularly.
You can take full amount after 15 years
Its maturity period completes 15 years after opening a PPF account and the account holder can withdraw his entire amount if he wishes. If you want to proceed with the account, you can apply through Form H. In order to extend the period of the account, you can withdraw up to 60 per cent of the total amount. After 15 years until you withdraw the entire money, you will continue to get interest on the remaining amount. Before this, a penalty of 1% will have to be paid for account closure.