Can You Close Your PPF Account Before 15 Years?

Can You Close Your PPF Account Before 15 Years?

Yes, you can close your PPF account before it has completed the 15 year lock in period, under certain circumstances. Your PPF account should have completed at least 5 years. This new rule has come into effect from April 1st 2016. Before this new rule was passed, you could withdraw your entire PPF, only after the completion of the lock in period of 15 years. Only on death of the investor, could the PPF amount be withdrawn before 15 years.

You can close your PPF account before 15 years, if you need money for the treatment of a serious ailment. You need money for the higher education of your children, you can close your PPF account prematurely. However there is a penalty for pre mature withdrawal. You would lose about 1% of the interest earned on the PPF account, as a penalty for the premature withdrawal. Public Provident Fund also called the PPF, is a very popular small savings scheme in India. The amount you invest in a PPF is tax deductible up to INR 1.5 Lakhs a year, under Section 80 C of the income tax act. The amount accumulated as well as withdrawn at maturity is tax free. PPF enjoys EEE benefits.