Public Provident Fund (PPF) is a scheme that people trust a lot. People use PPF for long term savings. People trust it a lot because it is a government scheme. Tax rules make this scheme more attractive.
This scheme is so attractive that many people want to open more than one PPF account. The question is whether this can be done?
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Can you open two accounts
According to the rules of PPF Scheme, 1968 (now PPF Scheme, 2019), a person can open only one PPF account in his name at a time. This means that a person cannot open more than one PPF account in his name in one bank or different banks or post offices. If a person opens more than one PPF account, then as soon as it is detected, all the accounts except the first account will be considered invalid. The money deposited in them will be returned to the person.
Can a PPF account be opened for a minor?
A person cannot open two PPF accounts in his name, but he can open a PPF account for a minor child. The person will be the guardian of this account. But, it is important to keep in mind that a contribution of more than Rs 1.5 lakh cannot be made in a financial year in your account and your minor child’s account. This can be understood with the help of an example. Suppose you contribute Rs 1 lakh in your PPF account, then you can contribute only Rs 50,000 in your minor child’s PPF account.
Can a joint PPF account be opened?
A PPF account can be opened only in an individual’s name. A PPF account cannot be opened in the name of two people. This means that if a person wants to open a joint account with his wife or son/daughter, then it will not be allowed.
What are the benefits of PPF?
PPF is such a scheme that if you run it till maturity, you can create a big fund. Deduction is allowed on investment in PPF. Secondly, interest earned in PPF scheme is also not taxable. A person can open a PPF account and claim deduction on maximum contribution of Rs 1.5 lakh in a financial year under section 80C. But, you have to keep in mind that this deduction is available only in the old regime of income tax.
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