Regulations for the Public Provident Fund permit investments beyond the 15-year maturity period.
Public Provident Fund (PPF) is a small savings programme backed by the government that attempts to offer investors an assured return at maturity. Section 80C of the Income Tax Act allows PPF account holders to claim income tax exemption. The exemption amount is nevertheless limited to 1.50 lakh in a single fiscal year. It is one of the few risk-free investment options that offer investors a better return.
Public Provident Fund interest rate:
Currently, a PPF account holder receives interest at a rate of 7.10%. Although the PPF interest rate is subject to vary on a quarterly basis, based on past performance, if we anticipate this PPF return for the following 35 years, an investor would get a maturity amount of almost 2.27 crore if they invested 12,500 per month in their PPF account. (Also Read: Avoid these 5 financial mistakes ahead of the new year)
A SEBI-registered tax and financial expert, Jitendra Solanki, discussed the advantages of a PPF account and said, "Up to ₹1.5 lakh investment is exempted under Section 80C of the Income Tax Act. So, one can avail income tax exemption on up to ₹1.5 lakh per annum."
The PPF account maturity time, according to Solanki, is 15 years, and to prolong a PPF account, Form 16-H must be submitted.
"PPF account can be extended in a block of 5 years and for that one will have to submit Form 16-H in the 15th year of PPF account opening. Similarly, if an investor decided to remain invested in PPF for the next five years, he or she will have to submit Form 16-H in the 20th year of account opening," he added.
Therefore, if an investor chooses to start a PPF account and invest for 35 years, he or she must complete Form 16-H in the 15th, 20th, 25th, and 30th years after opening the account.
If an investor invests Rs. 12,500 every month or Rs. 1.50 lakh in a year, they will receive a maturity amount of Rs. 2,26,97,857, or around Rs. 2.27 crore, assuming a 7.10 percent PPF interest rate for the next 35 years.
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 "Public Provident Fund scheme: Invest Rs 12,500 monthly and get Rs. 2.27 crore, know details")
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