• Deposits made in PPF accounts upto prescribed limits are eligible for relief under section 80C of Income Tax Act
  
• Interest earned on deposits in PPF accounts is exempt from Income Tax
• The entire balance in a PPF account is exempt from Weath Tax
• The balance in a PPF cannot be attached under a court decree

• The ceiling of deposit in the account increased from Rs. 70,000 per annum to Rs. 1 lac per annum w.e.f. 1st December 2011
  
• The rate of interest under the scheme increased from 8% per annum to 8.60% per annum w.e.f. 1st December 2011
• The interest on loan amount increased from 1% to 2% per annum
• The rate of interest has been further increased to 8.80% per annum w.e.f. 01.04.2012 (RBI/2011-12/483 DGBA.CDD.No. H-6506/15-02-001/2011-12)

The accounts in which deposits are not made for any reason are treated as discontinued accounts and such accounts cannot be closed before maturity.

The discontinued account can be activated by payment of the minimum deposit of Rs. 500/- with default fee of Rs.50/- for each defaulted year.

• Rs. 70,000/- per annum upto 30.11.2011
• Rs. 1 lac per annum w.e.f. 1st December 2011

• The rate of interest was 8% per annum upto 30.11.2011
• The interest rate increased to 8.6% per annum w.e.f. 01.12.2011
• The interest has been increased to 8.80% w.e.f. 01.04.2012

The interest is compounded annually.

The interest for the month is calculated on the minimum balance available in the account from 5th of a month to the last date of the month.

A PPF account cannot be transferred from one person to another. Even in the case of death of a depositor, the nominee cannot continue the account.

Application in prescribed form is to be made for loan along with the pass book of the account.

In case, the loan is sought from minor's Account, the guardian has to make a declaration that the money is required for the use/benefit of the minor.

The loan can be taken up to 25% of the amount in the account at the end of the second year immediately preceding the year in which the loan is applied for.

The loan is repayable in lump sum or convenient installments. Where loan is repaid within 36 months, interest is charged at 1% (2% w.e.f. 1st December 2011) and if it is not repaid within 36 months, the interest at the rate of 6% is charged on the outstanding balance. The interest is to be paid in not more than two installments after the loan amount is fully repaid.

Once the first loan is repaid, second loan can be obtained on same terms. This facility is available till the end of 5th financial year from the end of the financial year in which initial subscription was made.

Application in prescribed form is to be made for withdrawal along with the pass book of the account.

In case, the withdrawal is sought from minor's Account, the guardian has to make a declaration that the money is required for the use/benefit of the minor.

The amount of withdrawal is restricted to 50% of the credit balance at the end of the fourth year immediately preceding the year of withdrawal or the year immediately preceding the year of withdrawal, whichever is lower.

In case of accounts extended beyond Maturity period partial withdrawals are allowed once in a year with the condition that the amount of withdrawal during a five year block period should not exceed 60% of the balance in the account at the commencement of the block period.

PPF accounts can be opened and operated through an authorized agent appointed by the National Savings Organisation.

Only local cheques are accepted for deposit and the date of presentation of local cheque and demand draft is treated as date of deposit in the Account.

Balance in PPF account cannot be attached under court decree.

Entire deposit in a PPF account is exempt from the Wealth Tax.

The deposit in a minor account is clubbed with the deposit of the account of the guardian for the limit of Rs.70,000/- (1,00,000/- w.e.f. 1st December 2011).

On death of the account holder his nominee(s)/legal heir(s) cannot continue the account. The account has to be closed in such case.

Deposits in excess of Rs.70,000/- (1,00,000/- w.e.f. 1st December 2011) in a financial year in a PPF account are refunded without interest and the excess amount is not considered for income tax rebate.