How is PPF interest calculated?

PPF interest is compounded annually. Interest for each month is calculated on the lowest balance between the 5th and the last day of the month. The accumulated interest is credited to the account at the end of the financial year (March 31).

Yes, PPF enjoys EEE (Exempt-Exempt-Exempt) tax status. The annual deposit qualifies for Section 80C deduction (up to ₹1.5 lakh), the interest earned is tax-free, and the maturity amount is fully tax-free.

What is the PPF lock-in period?

PPF has a lock-in period of 15 years. Partial withdrawals are allowed from the 7th financial year onwards (up to 50% of the balance at the end of the 4th preceding year). After 15 years, you can extend in blocks of 5 years.

What are the minimum and maximum PPF deposit limits?

The minimum annual deposit is ₹500 and the maximum is ₹1,50,000. You can deposit in a lump sum or up to 12 instalments per year. Deposits exceeding ₹1.5 lakh in a year do not earn interest and are not eligible for 80C deduction.

PPF Calculator 2026 - Calculate Public Provident Fund Returns

PPF Investment Details

Yearly Deposit

₹

Min ₹500 / Max ₹1,50,000 per financial year

Interest Rate (% p.a.)

Current rate: 7.1% (reviewed quarterly by govt)

Time Period (Years)

Min 15 years, extendable in 5-year blocks

Quick Presets

PPF Maturity Value

EEE — Fully Tax-Free

Invested

₹22.50 L

Interest Earned

₹18.18 L

Maturity Value
₹40.68 L
1.81x

Investment Breakdown

Year-by-Year Growth

Year	Deposit	Interest	Balance

Assumes constant interest rate. Actual rate is reviewed quarterly by the government and may change.

How the PPF Calculator Works

A Public Provident Fund (PPF) account is a government-backed savings instrument with a 15-year lock-in. It offers guaranteed returns at a government-set interest rate, compounded annually.

The PPF Formula

For annual deposits made at the start of each year (annuity due):

FV = P × (1 + r) × [(1 + r)ⁿ − 1] / r

Where:

P = Annual deposit amount

r = Annual interest rate (as decimal, e.g., 0.071)

n = Number of years

FV = Maturity value of your PPF account

Why PPF is Triple Tax-Free (EEE)

PPF enjoys the coveted EEE (Exempt-Exempt-Exempt) status under Indian tax law:

Exempt #1: Your annual deposit (up to ₹1.5L) qualifies for Section 80C deduction

Exempt #2: The interest earned every year is completely tax-free

Exempt #3: The maturity amount (principal + all interest) is fully tax-free

Key PPF Rules

Lock-in: 15 years (extendable in 5-year blocks with or without deposits)

Deposits: ₹500 minimum to ₹1,50,000 maximum per financial year

Partial withdrawal: Allowed from 7th year onwards (up to 50% of balance at end of 4th preceding year)

Loan against PPF: Available between 3rd and 6th year

Premature closure: Only after 5 years, with 1% interest penalty, and only for specific reasons (serious illness, higher education)

Frequently Asked Questions

What is the current PPF interest rate?

The current PPF interest rate is 7.1% per annum (as of Q4 FY 2025-26). The government reviews and sets the rate every quarter. It has remained at 7.1% since April 2020.

Can I extend PPF beyond 15 years?

Yes. After the initial 15-year maturity, you can extend your PPF in blocks of 5 years — either with or without fresh deposits. If extended with deposits, the account continues to earn interest and allows partial withdrawals.

What happens if I deposit more than ₹1.5 lakh?

The excess amount above ₹1.5 lakh will not earn any interest and will not qualify for Section 80C tax deduction. It will simply be returned to you.

Can I have two PPF accounts?

No. An individual can hold only one PPF account. If two accounts are opened by mistake, the second one is treated as irregular and will earn no interest. The ₹1.5L annual limit applies to the single account.

Is PPF better than FD for tax saving?

For most taxpayers, yes. PPF interest is completely tax-free, while FD interest is taxable at your slab rate. A 7.1% PPF gives you the full 7.1%, whereas a 7% FD effectively gives only ~4.9% after 30% tax. The trade-off is PPF's 15-year lock-in vs. FD's 5-year lock-in for tax-saving FDs.