August 11, 2017

PPF Account for Minor and Wife – Rules, Tax Benefits and Tricks

PPF Account is considered as one of the favorite investment for many of us as it gives tax benefits and also the safety mentality. However, many of us open PPF in our name, minor kids name and also in wife name. But hardly few know what are the rules, tax benefits and tricks you can use with PPF Account for Minor and Wife.

# Who can open the PPF Account for Minor and Wife?

A guardian can open the PPF account for a minor child. Whereas, in the case of a wife, as she is major, she can open the account in her name directly and also be eligible to act as a guardian for your kids.

The guardian in case of minor should be anyone of the below.

-Father or Mother

-If both parents not alive, then any other guardian under the law can open PPF account for minor children, like Uncle, Aunt, Grandmother, Grandfather etc.

-If surviving parent not capable of to act, then the above said a relative of minor child open account.

Do remember that Both the parents cannot open a separate account for the same minor. Only either father, mother or guardian (in case parents not alive), can open ONE account in the name of a minor.

Hence, opening PPF account in Post Office with being you as guardian and opening another account in SBI bank with your wife as guardian on the same child is not allowed. You may open like this. If at any point of time, it got noticed, then you will loose the entire interest part on the another account. Hence, it is always best to follow the rule.

# PPF Account for Minor and Wife -How much is the maximum limit?

Let us now discuss the issue separately as PPF Account for Minor and PPF Account for Wife.

a) PPF Account For Minor

There is a huge confusion among many when it comes to the limit of investing in PPF in a family. The rule states like below.

The limit of deposit of Rs. 1,50,000 in a year by an individual in his self-account and accounts opened by him on behalf of his minor(s) of whom he is the guardian is COMBINED under rule 3 (1) of the Scheme. This limit is separate for account opened by the HUF or an association of persons or body of individuals vide rule 3 (2) of the scheme.“.

Hence, let us assume that you have 5 children. If you have your own PPF account and also you became guardian for all 5 children, then the COMBINED limit of your account and your 5 children account is Rs.1,50,000 ONLY.

b) PPF Account For Wife

Whether your wife has her own earning source or not, as she is an individual, can open the account in her name and also be a guardian for kids where you are not a guardian.

Again, in her case also, the combined limit for her and for the accounts where she is guardian stands yearly maximum limit of Rs.1,50,000 only.

Now as per the rule, the total deposit into Self+Minor account should not cross Rs.1,50,000 a year. However, one is free to deposit into one’s spouse account. Hence, by doing this trick, you can maximize the investment option into PPF.

Now let us take an example of how much maximum one can invest in PPF including his, spouse and minor kids account.

Let us assume Preetam, his wife Dhanya and their two minor children Jeevan and Prachi. How much and in what way they can invest in PPF to the maximum? Let me explain the same through this image.

PPF Account for Minor and Wife -Maximum Limit

You notice from above example that being guardian to all your kids will not help you to maximise the investment. However, if you have two kids, then you and your wife being guardian to individual kids will makes you beneficial and maximizing the investment option into PPF.

PPF Account for Minor and Wife -Tax Benefits

From above rules, it is clear that the maximum limit to invest for an individual along with the accounts where he is a guardian is Rs.1,50,000 only. But what are the tax benefits if we have PPF Account for Minor and Wife name?

As you all know, PPF is E-E-E (Exempt-Exempt-Exempt) product. This means whatever the money you invest in your PPF account can be claimed for tax benefit under Sec.80C. The interest income during the tenure of the product is tax-free. Same way whatever the amount you receive from PPF at maturity is purely tax-free.

However, what Sec.80C refers is that any investment done in PPF account in the name of Self/Spouse or Child (Major or Minor) is eligible for deduction.

Here, I will divide the case into three categories.

a) PPF Account of Self+Minor Child

Whatever the contribution you do towards your own PPF and to the minor child contribution (where you are guardian) can be directly claimed for deduction under the Sec.80C limit for up to Rs.1,50,000.

Do remember that you may have your one PPF account but may be a guardian for 3 kids PPF account. But the combined limit for tax deduction under Sec.80C is ONLY Rs.1,50,000 (irrespective of the number of kids or number of the accounts where you are guardian).

b) PPF Account of Self+Wife

As per Sec.80C eligibility conditions, any investments you did for self or spouse is also eligible for deduction. But again the combined limit for deduction is only up to Rs.1,50,000. However, if she has her own earnings and if she contributing for her own PPF, then you can’t claim on behalf of her investment. The investment must be from your income. Because the eligibility condition for deduction under Sec.80C states as below.

the aggregate amount of the deductions of income so allowed in respect of the previous year or years preceding such previous year, shall be deemed to be the income of the assessee of such previous year and shall be liable to tax in the assessment year relevant to such previous year.

Assume that your wife is not earning or she does not have any of income source. Then you can invest in her PPF account. However, as the source of investment is from your income, the clubbing provisions apply here.

Let us say Mr.X donate Rs.1 lakh to his wife Mrs.X. Then for Mrs.X, the amount is not taxable. But what if she invests this Rs.1 lakh in Bank FD and earns Rs.10,000 on this in a year? Is it the income of Mr.X or Mrs.X? In such situation clubbing of the income, provisions will come into the picture. Such interest income of Rs.10,000 will be clubbed with Mr.X and he has to pay the applicable tax.

However, as I already stated above, PPF is the E-E-E product. Hence, even if you invest in your wife’s PPF account and any interest earning from such PPF is tax-free. Hence, at the end, there is no tax liability for you.

Instead, you can claim the tax benefits under Sec.80C if the source of such investment is from your income.

c) PPF Account of Self+Major Child

As per Sec.80C benefits, if you invest in your major child PPF account, then also you can claim the tax benefits. But the source of such income should be from your income. If the source of income of such investment is from your major child, then you are not eligible to claim the deduction under Sec.80C.

Here, the clubbing of the income rule not apply. Hence, assume you invested in your major child PPF account, then any earning from this investment should be your major child’s income (even though PPF interest is tax-free and he has no tax liability) but not your income.

What if you invested more than the prescribed limit in PPF?

Many do such mistakes. They feel that their own PPF account and their minor kids PPF account combined limit is not Rs.1,50,000 but Rs.3,00,000. Because they feel each PPF account will come with a maximum limit of Rs.1,50,000. In such situation, there is no such monitoring tool either with Bank or Post Office. Hence, they also accept without any cross checking.

Any such additional deposit which is beyond the rule will be returned to you without paying you a single rupee of interest on this. Hence, it is always best to follow the rules.

What to do when the minor kid becomes major?

When the minor attains majority before the maturity of the PPF account, then he will himself continue the account thereafter. He will submit a revised application form for opening the account to the Accounts Office. His signature on the application form will be attested by the guardian who opened the account of the minor or by a respectable person is known to the Accounts Office.

Refer our earlier posts related to PPF:-

225 Comments

  1. Hi, I have PPF account in my spouse name(last 15 yes ) Who is not working I have no ppf account in my name i have been taking tax benefits from her account as I pay the subscription from my income
    Mosley me know whose money is it any way on matuurity ? Mine or spouse’s

    Reply
    • Dear Shree,
      It is her money but the source of funding is your’s.

      Reply
    • Dear Sir, last year I read your article and opened accounts as you had suggested in the block for my family with both parents working and 2 children and contributed as you had suggested to a maximum of 6.0 L. Recently I came to know that PPF rules have been amended last year and now it says that amount deposited in self or minor account together should not exceed 1,5L in a year. Is this true? If so what are the implications if we continue to deposit 6L in the way you have suggested?
      For reference I am reproducing the lines from the gazette notification dated 12th December 2019
      4. Limits of subscription.-(1) A deposit which shall not be less than five hundred rupees and not more than
      one lakh fifty thousand rupees in multiple of fifty rupees may be made in an account in a year.
      (2) Maximum limit of one lakh fifty thousand rupees as specified in sub-paragraph (1) by an individual
      shall be inclusive of the deposits made in his own account and in the account opened on behalf of the minor.
      Please clear my doubts, thanks

      Reply
      • Dear Narendra,
        There is no change in the rules with respect to what you are mentioning. Hence, this post still holds good.

        Reply
        • Sir my question was whether the subclause (2) of 4, i,e limit of deposit of 1,5 lakhs in his own account and in the account opened on behalf of minor will be a problem? (Here there is no mention of source of funding, but limit is amount deposited in the combined account). Please calrify

          Reply
  2. Dear Sir,

    Me and my wife, both are salaried. we have two minor daughters and we both contribute in their SSY accounts 1.5 L each and hence 80 C is already exhausted. Now in your above blog suggesting 6 L maximum deposit in PPF A/c, how can we deposit in our spouses ppf account if we have already deposited in our kids’ accounts. I’m sorry, but in PPF rules, it is written that one can deposit in self, minor or spouse account but overall limit is 1.5 L. I’ll very thankful to you if you could please cite any particular rule/section in this regard. I’m not looking for any tax exemption but only looking for maximising my returns. Thanks & regards.

    Reply
    • Dear Ashish,
      PPF and SSY are different products. Don’t connect for investment (but for tax saving the maximum limit is Rs.1,50,000). Regarding how to maximize, I have already explained in the above post. Refer it properly.

      Reply
  3. Hi,

    I am having ppf account as father self /minor , I am paying my ppf from own saving account and minor ppf from HUF account I am depositing with both account 1.5 lakhs now question is do I able to avail interest on ppf for me on 1.5 and for my minor account on 1.5 as well after 15 years?

    Reply
  4. My daughter guardian is my wife for PPF account..she is not working.This account has 1.5 lakhs deposited.
    Can I open a separate ppf account for me to deposit another 1.5 lakhs..

    My wife has some rental income in her bank account on monthly basis.

    Reply
  5. ISir,
    My wife is house wife.She guardian for my first daughter’s PPF and provided her Pan number.invested 1.5 lakhs this year.
    To maximize the investment,is it allowed to open a new PPF account in my name with my pan details for maximum investment?
    For 80C exemption I will not use this PPF.

    Note:My wife receive some rental income in her bank account.

    Reply
  6. Hi Sir, I am house wife and my husband have an Nre status in bank account but my status is resident in India. So , can we open PPF account on my name?

    Reply
    • Dear Shradha,
      Yes, you can open the PPF account in your name.

      Reply
  7. Hello Sir,

    Please clarify my below query :

    I and my wife have both invested 75,000 rupees individually in my wife’s PPF account for this financial year making the sum to 1.5 lakh rupees. My wife’s PPF account is having her PAN card linked to it. I am not having any PPF account and my PAN Card is not linked to any of the PPF account.

    Can we both claim tax exemption under section 80C for 75,000 rupees individually?

    Also, Please let me know what all documents do I have to submit for my investment in my wife’s PPF account?

    Thanks,
    Amit

    Reply
    • Dear Amit,
      Yes, you can claim for the benefit up to the amount you contributed to your wife’s PPF account. You can submit your wife’s PPF account statement as a proof.

      Reply
  8. Hi Basavaraj,

    Me and my wife both are working, Her taxable income is below 5L after claiming 80C deductions via tax saver FD.

    I want to deposit 50k in her PPF account and 50k in LIC and claim that for my tax benefit by paying the amount from my income. Is this allowed? How can I prove the source of the mentioned investment is from my income?

    Reply
    • Dear Ramakrishnan,
      Yes, it is allowed. The fund transfer from your end is a proof.

      Reply
      • Thank you very much for the quick reply

        Reply
  9. Dear Basu,
    I have PPF account for my minor child with my details as guardian. Another PPF account for 2nd child is linked with my wife’s name as guardian. Can children’s grandfather deposit 1.5 lakh each on these two accounts? Are there any legal implications? Do we break rule by doing this?

    Reply
  10. Sir – I and my wife each have separate PPF accounts. I will open one in my minor son’s name with me as guardian.

    Background: –
    My wife PPF account her pan card linked
    My PPF account my pan card linked
    My Child ppf account (should i link my pan card?)

    1. So now i invest 1.5 in my minor childs Account
    2 . I invest 1.5 in my wife’s account
    3. My wife invests 1.5 in my account.

    So interest would be paid for 4.5L every year we are investing. Am i right here.

    Now coming to tax part. How should we claim tax exemption..
    MINE –
    Should i claim tax exemption for 1.5 invested in my child’s account or claim tax for 1.5 L invested by my wife in my account.
    WIFE-
    Should my wife claim tax exemption for 1.5 for the amount i invested in her account or the amount she invested in my account?

    Thank you!

    Reply
    • Dear Avinash,
      Yes, you are right. Yes, they will ask for a guardian PAN card. Regarding tax part for YOU-You can claim on any one as the maximum limit is Rs.1.5 lakh only. Your wife can claim the investment did in her account by you.

      Reply
      • Thank you so much Sir..

        Reply
  11. I have a query regarding how the contribution (source of deposit) is done for PPF account of self and my wife.

    Background info:
    -Joint savings account with my wife in SBI.
    -Individual PPF accounts (self and wife) in SBI.
    -Every year, I transfer money, for PPF deposit, from SBI joint savings account to both PPF accounts.
    -Passbook entry of my wife shows “Transferred from “.
    -PPF deposits have been successful over the years, to both the PPF accounts.

    Questions:
    -Will there be any problem to my wife’s PPF investments later as the money deposited is transferred from SBI joint savings account (and not from her account from another bank)?
    Or
    -Should I ask my wife to transfer her PPF deposit every year from her another bank’s savings account?

    Thanks.

    Reply
      • Thanks Basavaraj.

        OK, so I can transfer PPF deposits from our joint savings account to our individual PPF accounts.
        My wife’s passport entry is shown as “Transferred from primary account holder”.

        Reply
  12. Hello Basu
    I have gone thru this article and understand that the trick is to depositing amount in your spouse account to get max benefit. (and not your own account) . The question is “does PPF dept or service provider (like banks) has ability to identify who has deposited? . I don’t see on account statement, who is depositor. It may not be logged in the system at present.
    I believe the only trigger they have set “not to accept more that 1.5 lakhs in any PPF account per year” . So PPF system may not be that intelligent to catch this at present, until, each account have properly linked to Adhaar or valid PAN , across all service providers, to sum up PPF amount per year under per PAN / Adhaar . I think till that time , one family can be benefited with this trick :).

    Now a days they have started to see that even guardian also declare his PPF account number in minor’s PPF account opening form.
    Thanks
    Janu

    Reply
    • Dear Janu,
      Even if they have such a mechanism, without breaking rule, you can easily invest in the above-said manner. In the end, you are NOT BREAKING THE RULES.

      Reply
      • Thanks Basavraj.
        Can we apply same trick on post offfice MIS where max investment limit of ( at present 4.5 lakh individual/9 lakh for joint) can be increased to 18 lakhs for 4 accounts for a family with 2 minors?

        Reply
  13. Thank you. I have understood clearly from your article. Not many are aware of this. Not much info regarding this. I wanted to be doubly sure that what I am doing is as per rule and I will not have problem in getting back my money with interest ?
    Thank a lot for your time

    Reply
    • Dear Swarupa,
      YES, you will get interest. Because you are not breaking the rule 🙂

      Reply
  14. Except yours , pattu sirs and Ashal sirs I couldn’t get any other article on googling. So wanted to here about real experience where it has been done and interest has been credited you hassle-free
    Thank you

    Reply
    • Dear Swarupa,
      Maybe YES. But yes, using the above combination you can invest.

      Reply
  15. Sir, do you have experience either self or with your clients where 6 L was deposited and interest credited in all 4 accounts. Asking again to confirm because I don’t want to mess up with my inv and lose interest on 3 L.

    Reply
    • Dear Swarupa,
      I think by now you got enough clarity after reading this post and also the FB discussion.

      Reply
  16. Sir, I am planning to deposit 1.5L in my spouse ppf acc and 1.5 L in minor ppf acc in which I am guardian. The same will be done by my husband also- he will deposit 1.5 in my acc and 1.5 L in minor ppf in which he is the guardian. This way we will be investing 6 L.
    Can this be done ?
    Will we get interest for 6 L? I am asking because there is lot of confusion in this aspect? Sir do you have experience with any of your clients doing this ??

    Reply
    • Dear Swarupa,
      This is what I have explained in the above post. It can be done.

      Reply
  17. Hi sir,
    I am an NRI. I have my own ppf account. I have my wife and minor child in my family. My wife has also separate own ppf account. They are not NRI. I know that I can maintain my ppf account till maturity as per NRI rules.
    I am only the earner in my family.
    1. Can I open my child’s ppf account me as a guardian?
    2. Can I deposit 1.5 lac to my child ppf account? I am aware that maximum limit is 1.5lac together my and my child’s account.
    3. Can I contribute another 1.5lac to my wife’s ppf account?
    My intension is not to get any benefit of 15C here. But my main intension is to reduce my NRE account money at least 3lac in a year to my child and wife ppf account so in future my tax liability will get reduced and it will be distributed to my wife and child (when become major)

    Please let me know my above thinking and planning is valid and genuine which will help me in future.
    Thanks.

    Reply
  18. I am planning to open a new ppf account for my minor son,and would contribute Rs 1.5 lakh from our HUF account.This will be in addition to my own ppf account contribution of Rs 1.5 lakh per year.My question is whether total contribution of Rs 3.0 lakh will qualify for seperate ppf accounts ie myself and my minor son ?

    Reply
    • Dear Parmeet,
      I don’t think HUF are allowed to be even guardian of the PPF account.

      Reply
  19. Hi,, I’m having PPF account & also I’m guardian of my minor sons PPF account…in my PPF account my mother is contributing 1.5lac & taking benefits of 80c in her income tax return,,,myself contributing 1.5lac in my son ‘s PPF account & taking benefit of 80c in my IT return…..my wife is earning & contributing to her PPF account…so is it a valid & legal way to do it ?

    Reply
  20. I have ppf in icici and my wife have in sbi.

    My son7 years old have ppf in icici with his minor PAN CARD and my daughter 4 years ols have ppf in hdfc with her minor PAN CARD.

    As per my understanding we 4 family member have individual PAN CARD so we can invest 1.5*4= 6lac and can cliam tax benefit in 80c

    Kindly confirm if I m wrong

    Reply
  21. One more question. Is there any distinct advantage in Sukanya samruddhi yojana over PPF when opening for a girl child? They seem to pay 0.5% more but overall long term benefits?

    Reply
    • Dear Naveen,
      Nothing so special. In fact PPF can be extended throughout your life but not Sukanya Samriddhi Account.

      Reply
  22. Hi,
    I was reading at another place that only 1 minor account can be opened with 1 guardian. Is it true? If a person has 3 children(all minor) they can’t have PPF for all? Thanks!

    Reply
    • Dear Naveen,
      There is no such hard rule. However, again the same rule of maximum deposit applies here also. Combined of his own and the accounts where an individual is a guardian, the total limit is Rs.1.5 lakhs only.

      Reply
      • Thank you

        Reply
  23. Dear Mr. Basavaraj,

    I liked your article and your understanding on this subject.

    I am confused about the 3 cases you have explained in the image, and how can they deposit more than 3 lacs combine.

    My case – Me and My wife both are working and both have their individual PPF accounts. We have 2 minor sons – both of them have their PPF account. I am the Guardian of one of my minor son and my wife is guardian of other son.

    As per my understanding the total investment we can do in your accounts (all 4) is maximum 3 lacs. (1.5 lacs * 2). So in your example you have explained they can deposit 4.5 or 6 lacs. How this is possible?

    I am missing anything here? Please explain.

    Reply
    • Dear Ashish,
      The combined limit YOU can deposit your own and your minor kid account is Rs.1.5 lakh. However, it is nowhere written that your wife CAN’T deposit into your PPF account. This is what I have explained.

      Reply
      • Hi Basavarj,

        Even if wife deposits to husband’s PPF account, total limit on the account can not be 1.5L in a financial year, how can the total limit can go that limit in the given examples..

        As per my understanding, maximum investments in a PPF account is 1.5L only either spouse deposits or not..I mean it can be either of their money, but still max limit is 1.5L…Please correct me if I am wrong.

        Reply
        • Dear Ranga,
          The combined limit YOU can invest in both the accounts must be Rs.1.5 lakh. But there is no such rule that your WIFE must not invest in your PPF.

          Reply
          • does that mean if just Preethan and Dhanya (no kids) can invest upto 6L into PPF?

            Preetham invests
            1. 1.5L into self PPF account
            2. 1.5L into Dhanya’s PPF account

            and Dhanya invests
            1. 1.5L into self PPF account
            2. 1.5L into Preetham’s PPF account

            total 6L?

            on your other post (all-about-public-provident-fund-ppf) you have mentioned

            “Any amount you deposit in your PPF account more than the prescribed limit of PPF for that particular year will not earn any interest.”

            Does it mean the amount which was deposited by Spouse is not earning any interest?

            Reply
            • Dear Chethan,
              If they don’t have kids, then they can only invest Rs.3 lakh.

              Reply
  24. Hi. I am a NRI. However my wife and child are at India. Can i open a PPF account for my child?
    They came to my place once in a year for 2 months only. I am not sure whether they are also NRI or not.
    Please suggest.

    Reply
  25. Hello Sir,

    My wife is working and she submits her own IT returns every year though she doesn’t come under the 5% slab, so she has zero tax liability.
    I want to open a ppf account on her name and I want to contribute 1.5lacs in that account and want to claim tax deduction u/s 80C. I don’t have PPF account on my own name. Can I do that? Or since my wife has sourse of income and submits her own IT even though I deposit money in her PPF I can’t claim tax deduction?

    Please suggest

    Reply
    • Dear Arman,
      May I know why you don’t want to open the PPF account in your name?

      Reply
      • I already have my LIC and ELSS.

        Reply
        • Dear Arnan,
          If your Sec.80C is already filled, then why you want to invest in PPF for TAX SAVING PURPOSE?

          Reply
          • Dear Sir,
            My wife is working and i am also working and i dont have any ppf account.But i want to open a ppf account for my wife and want to invest 25000 in her ppf account.Will i get tax benefit for my investment in her account ??
            I dont want to open a PPF account for self.I want to invest her money into her PPF account through my saving account.As my parents are my dependent and i have not money to invest in my own ppf account.

            Please suggest will i get tax benifit or not??
            Vijay Gupta

            Reply
            • Dear Vijai,
              Will i get tax benefit for my investment in her account ??-YES.

              Reply
  26. Sir,
    As per your guidance, we can invest 1,50,000 every year to my spouse and self accounting 6.0 lac and claim 1,50,000 deduction in each case. The intrest pay out is limited to 1.5 lac or for 3.0 lac in each PPF account.
    Also can I open PPF account in my son who is major and he is studying now. I would like to deposit 1.5 lac in his account by a way of transfering the amount to his account through Gift and later transfering to his PPF account .
    Pls guide

    Reply
    • Dear Manjunatha,
      By the set up I explained above, you are not breaking any rules. Hence, no question of interest credit. If your son is major, then it is considered as separate account but not clubbed with your account for the investment purpose.

      Reply
  27. Sir,
    I have ppf account and i submit 1.5 lac every year which i claim for tax benefit. Can i open seperate ppf account for mybminor kid and deposit 1.5 lac in it. I understand that i wont get tax benefitfor kid ppf. But will he atleast get interest on his account

    Reply
  28. Dear Sir,
    It is mandatory PAN no for withdrawal & closing of PPF Account after maturity ?

    Reply
  29. Can HUF Deposit on behalf of Minor into his PPF Account?

    Gift to Child by Grandfather/or any other person, if deposited into Minor child account, will it be clubbed with father’s income?

    According to your example, if non-Guardian spouse deposit money into minor child account, clubbing provision will not be applicable?

    Reply
    • Dear Adarsh,
      HUF are not eligible to open the PPF account. “Gift to Child by Grandfather/or any other person, if deposited into Minor child account, will it be clubbed with father’s income?”-Gifting rules applies and hence not eligible for tax under the head of father. “According to your example, if non-Guardian spouse deposit money into minor child account, clubbing provision will not be applicable?”-YES. Even if applies also, PPF interest is totally tax-free. Hence, no tax liability on PPF account holder.

      Reply
  30. Hi sir I just want know that.. If one kids ppf account was already opened with mother. Can we change it from one bank to another bank ?
    And can we change the guardian? Like behalf of mother can we add father in that ppf account?

    Reply
    • Dear Priyanka,
      Yes, you can transfer the PPF account. However, you are not allowed to change the Guardian.

      Reply
  31. Dear basu…i hv one ppf account in my name and one ppf account in my wifes name. We deposit 1.5lakh each in ppf account on our own as we both are earning…
    Now my question is ,
    Can i open a ppf account in my minor daughters name for whom i will be guardian and deposit 1.5lakh?
    And similarly can my wife do so for our minor son ?

    Reply
    • Dear Praveen,
      The combined limit of you and your minor kid deposit must not be more than Rs.1.5 lakh per year.

      Reply
  32. if husband had his own ppf account and he had deposited 1,50,000 in that. in the same year he had also deposited 1,00,000 in her wife’s ppf account. now my question is that the husband will get deduction under 80c upto 1,50,000 but can wife also get the deduction of 1,00,000 under 80c. wife is a salaried person.

    Reply
    • Dear Kiran,
      You can claim the deduction from total income in respect of contributions to any PPF belonging to self, spouse or any child. However, the source of funding to wife’s account is not from her own earning. Hence, she can’t claim the deduction.

      Reply
  33. Hi

    I have a ppf account and also the guardian of the ppf account of my minor son. Question is the interest that is credit in my sons ppf account, does it become an income for me and has to be shown in my tax return as income from other sources or is the interest tax free like the interest i receive in my ppf account ?

    Reply
    • Dear Anirban,
      As the PPF interest is tax-free, you no need to mention in ITR about the same.

      Reply
  34. your article was very clear, thanks. My question is as follows. I do not have a ppf (but EPF with my company), however am the guardian of my son’s ppf acc. My wife has a ppf acc and guardian as well for my daughters acc. Wife is not earning, what is the maximum i can invest. Am not bothered about 80c deduction.

    Reply
    • Dear Thiru,
      You can invest in your son’s account up to Rs.1.5 lakh. Along with this, you can deposit into your wife’s PPF account for another Rs.1.5 lakh. She can (from her income) can deposit in your daughter’s account up to Rs.1.5 lakh. But these many PPF accounts really a NEED?

      Reply
  35. Hello,

    Invested in minor PPF & SSY and earning exempted interest of 1500 INR. Additionally, invested in taxable fd in name of minor earning interest of 1500 INR. Net income from minor investment is 3000 exempted and 1500 taxable.

    How to show in ITR and will there be any tax liability?

    Reply
    • Dear Ankit,
      Hard to guide step by step with your limited sharing.

      Reply
  36. Hi,
    My wife and my Son has PPF accounts. My wife is Guardian for Son’s Account.
    I am depositing 1.5L each(total 3L)into both accounts. As per your logic, this should be FINE.
    I am not bothered about tax claim.

    Reply
  37. . Excellent and helpful post. I however have a query. My minor granddaughter has a PPF account under the guardianship of her father(my son in law). If my daughter the child’s mother deposits money in this PPF account can she avail tax benefits for her investment. The total investment in minors PPF account and mothers own account is below 150000.
    Appreciate your reply.

    Reply
      • Thank you so much for the prompt reply

        Reply
  38. Sir things are very clear after reading your articles yet i have some fears to avoid future troubles.I and my wife both are working and have ppf accounts seperatelyThus we invest total 300000 each year.We have one ppf account opened in the name of my son.After investing our[husband and wife] 150000 seperately with our own individual income,can we both invest 75000 each from our seperate accounts to our son’s ppf so that this investment can become 150000?

    Reply
    • Now i read all the questions and came on this conclusion that we cant do like this.i forgot to write that this is i who is the guardian of the son.since we are investing in ppf from our own accounts seperately we cant invest any more in our son’s ppf.but from next financial year we shall invest in ppf account from each others account instead of investing from our own accounts.And as far as my son’s ppf is concerned it will be invested by my wife instead of me since i am the guardian.Am i right sir?

      Reply
      • Arvind-The combined investment under your account and your kid’s account (where you are minor) should not cross Rs.1.5 lakh a year. This also you have to keep in mind.

        Reply
    • Arvind-The combined investment under your account and your kid’s account (where you are minor) should not cross Rs.1.5 lakh a year. This also you have to keep in mind.

      Reply
      • sir this has confused me.does it mean that my wife [from next financial year as i have refered to] can invest only 1.5L from her bank account in total under my ppf + my son’s ppf [whose i am the guardian]?and i can invest 1.5L only from my bank account into my wife’s ppf.so the total investment is only 3L .This is the confusion.kindly specify.

        Reply
        • Arvind-I think you confused again. Refer the logic I explained. Your wife can deposit into your account and YOU can deposit into your kid’s account. By doing so, the maximum you can do in two accounts is Rs.3 lakh.

          Reply
          • Ok sir but what will happen to wife’s ppf ?Will it remain uninvested then?

            Reply
            • Arvind-Either you can invest in her PPF or she can invest on her own (as she not crossing the limit of Rs.1.5 lakh in her own account right?).

              Reply
  39. I and my wife are both earning and already invest 1,50,000 yearly each in PPF.
    1) If I invest another 1,50,000 from my income in the name of my minor child, will that amount earn interest?
    2) I understand that under 80C, I can still claim only 1,50,000 deduction, which is ok. But, interest will be paid in my child’s account, which will be exempt on withdrawal on maturity?
    3) Can this same account be continued when he becomes a major? Interest will keep compounding in the same account after it is converted from minor to major?

    Reply
  40. I have deposited 75000/- in my wife’s PPF account – she is working; can she claim tax benifit from her employer?

    Reply
    • Mukhopadhyay-It is the source that matters. Hence, you can claim that benefits but not your wife.

      Reply
  41. Here is my case study, self earning, wife(house wife) and child Minor.

    I have been transferring 1.5L to my wife’s account towards PPF. PPF is on wife name, she transfers to her PPF account.

    Can I open PPF account on my name and transfer 1.5L?

    Reply
      • Thanks for a quick response!

        I was considering 1 account for a family!

        One more doubt,
        For a family with wife not working 3L is max?? Or is there anyway I can do have son’s account and increase from 3L to 4.5L

        Reply
        • Winny-Refer above post properly. I already explained the limit details.

          Reply
  42. Thanks for the explanation of the rules.

    Referring the image, in all 3 Cases, it means the spouse can deposit 150000 into each other’s account.
    Does this mean that each spouse (major individuals here) will have deposited 300000 in their own PPF account?
    i.e. Preetam deposited 150000 into his account
    and Dhanya deposited 150000 into Preetam’s account
    so Preetam’s PPF account has 300000 deposited in a FY.

    Reply
    • Vi-The individual PPF limit is Rs.1.5 lakh only. This will come into picture when parents are the guardian of their kids.

      Reply
      • Thanks.

        Sorry, I need bit more clarity.

        Assuming both Preetham and Dhanya are working and have single kid (whose guardian is Preetham).

        -Preetham deposits 1.5L into kid’s PPF account. (So Preetham can not deposit any money into his own PPF account now.)
        -Preetham deposits 1.5L into Dhanya’s PPF account.
        -Dhanya deposits 1.5L into her own PPF account. (Fund Transfer from her own savings account.)
        -Dhanya deposits 1.5L into Preetham’s PPF account. (Fund Transfer from her own savings account.)

        1. What is the total amount deposited into each PPF account in a single FY?
        Preetham 1.5L
        Dhanya 3.0L
        Kid 1.5L
        ?

        After I wrote the above in a notepad, I thought to read comments, if any, related to 4.5L or 6L and got more clarity.

        2.
        Does online banking (i.e. Fund Transfer to SBI/ICICI Bank PPF account) accepts such transfers into PPF accounts where the total deposit would become 3.0L in a single FY, considering there is a limit of 1.5L?
        If systems do not accept this, then I think this rule/trick is of no use.

        3.
        In general, to all PPF account holders, has any one tried this 3.0L story i.e. able to deposit 3.0L?

        Reply
        • Vi-Once Preetham deposits Rs.1.5 lakh into Dhanya’s account, then the limit is over. She no more deposit again into her own account for that year. However, Dhanya can deposit into Preetham’s account. Because his own PPF account not crossed the limit of Rs.1.5 lakh. Hence, in all they can invest up to Rs.4.5 lakh. Regarding online acceptance, it is up to bank to decide.

          Reply
          • Thank you for the clarification. I think I understood the 3 Cases now.

            (So the story of 4.5L or 6L needs to be verified and not 3.0L :-))

            Reply
  43. I opened a PPF A/c (maintained by SBI) in my minor daughter’s name ( her date of birth is 26.09.2002) on 22.03.2003. with me as her father & natural guardian. Since then I have been depositing money in this a/c regularly each year.
    Now, after the expiry of 15 years when I went to claim the supposed matured amount after 31.03.2018., the bank branch is saying that the maturity period is showing to be 31.03.2020 in their servers & that I can’t withdraw any sum before that date also. This is the opinion of the Chief Manager of the branch with whom I met yesterday.
    So, my question is whether this is true that a minor’s PPF A/c is not matured before he/she turns major, & if this is indeed the truth then how does it mature on 31.03.2020 when my daughter is still a few months away from attaining majority? & how shall we be able to withdraw the amount? Can it be credited to my savings a/c (in the same branch) or need I open another savings a/c in her name as a minor?
    Please clarify Sir. Regards

    Reply
  44. I am nri working in gulf and my wife and 2 minor kids lives in India . I am the only person working and my wife is a house wife with no income…. if I deposit 1.5 lake in my wife saving account and she use this amount for the ppf account of my son ppf account I think this is not a problem. But my question is can I deposit in the ppf of my wife from my nre account ? Because as I cannot have a ppf. I need your advice to make maximum investment in ppf …

    Reply
      • Thanks Sir for your quick reply…. it means in my case I can deposit 1.5 lakh in my wife ppf account from my nre account and the money which I send in her saving account is a gift to her and she can use that money to deposit 1.5 in her son account. So I can have 3 lakh investment, and how about me depositing in my daughter ppf account from my nre account?
        Me 1.5 to wife ppf account
        Me 1.5 to daughter ppf account
        Wife 1.5 to son ppf account

        But the source of all these funds will be my myself from my NRE Account….. please advice

        Reply
          • For now only my wife have ppf account…. my two kids don’t have ppf…. I want to open ppf account of both or anyone of them as per the possibility….
            First…I know I cannot be the gaurdian of my kids ppf account as I am nri….
            second…. my wife can be the gaurdian of both kids but the problem is she can deposit max 1.5 lakh in total for her and her kids.
            So if I understood well….. I can deposit 1.5 lakh in my wife ppf and my wife can deposit 1.5 in total for both of my kids ppf as a gaurdian….

            So correct me if I am wrong max I can do an investment of 3.0 lakh annually….
            I need your advise for the possibilities of investment for my family in ppf…
            and I will add up as an nri …. my income is totally tax free in my NRE Account

            Reply
            • I think you can’t deposit 3.0 but only 1.5 lakhs per year. as a major (resident) your wife can cumulatively deposit only 1.5 Lakhs per year (incl her a/c, and minors/dependents a/c).

              Reply
                • Basavaraj,

                  I think issue here is not who deposits in whose account, issue is who is owner of the account. As per rules, to the best of my understanding and as noted below, a major resident can deposit only upto 1.5 lakhs incl his/her PPF A/c plus his/her minor’s a/c. Please refer the “combined” in below statement.

                  Deposit limit
                  The maximum amount that can be deposited in a PPF account in a given financial year is Rs 1.5 lakh. You can open a PPF account in your own name or on behalf of a minor of whom you are the guardian. This is the combined limit of self and minor account. If the contribution exceeds the given limit of Rs 1.5 lakh, the additional money will not be eligible or any tax deduction or carry any interest.

                  Reply
                  • Akhil-The rules you are saying is already explained by me in above post. However, husband can invest in wife’s PPF account and wife in reverse can also.

                    Reply
  45. Hi.. I have a small query…I don’t have a PPF account but 1.5 lakhs is exhausted through life insurances and mutual funds in an year.. My wife has her own PPF account and she has already invested 1.5 lakhs in her account for this financial year.. My query is wat is the maximum she can invest in my 5 year old daughter PPF account through her earnings ?pls reply..

    Reply
    • Abhishek-If she is the guardian of your daughter account then she can’t invest beyond the yearly limit of Rs.1.5 lakh.

      Reply
  46. Please suggest if I have a PPF account in My name, wife’s name and (house wife) and my kid’s name (minor). Can I deposit 50k each per year and claim 1.5 lakh under 80 C for myself. Also after 15 years from now when my kid will be major and earning, will he be allowed to withdraw past investments and be allowed to continue investing further for his own claim under 80c there on

    Reply
    • Vishal-You can claim so under Sec.80C. However, the combined limit of you and your minor kid’s account (where you are guardian) should not be crossed to Rs.1.5 lakh in a financial year. Once your kid turn major, then yes he can use and withdraw the money as per his wish (including investment).

      Reply
  47. I am shweta here..I have a new born baby in whose name is wish to open ppf account in which I will a guardian n also I wish to open a ppf account in my individual name. If I deposit around 50k in each account every year can I claim tax rebate for both the accounts

    Reply
  48. My Family:
    1. Me (Working)
    2. Wife (Not Working)
    3. Daughter (Minor, not working)

    Me and Wife both have our PPF accounts, and deposit 1.5 lakh every year (say in each others account). Now can my wife open a PPF for my daughter and deposit 1.5 lakh to get extra investment and interest? Please clarify?

    I am worried if this is not true and after 15 years some issue happens it will be a big trouble?

    Regards
    Amit

    Reply
      • basis your suggestion i will open the account. i have yet not opened thinking it is not possible to invest more than 3 lakh in given combination.

        i am salaried and my wife has some interest earnings from family property

        Reply
        • I read all the comments and now my understanding is clear, and here it is:

          I will invest 1.5 lakh in my wifes ppf and my kids ppf (me guardian) and she will invest 1.5 lakh in my ppf. this way we will invest 4.5 lakh per annum combined.

          I am just not sure whether these SBI oldies will understand this

          Reply
          • Amit-But the source of income for your wife to invest in your account must be from HER OWN.

            Reply
            • Yes my wife files annual ITR where she has interest earnings “gift from relatives”. Hope that should be fine.

              Reply
                • Hi,

                  I cross checked with another personal financial advisory and as per them PPF investment is by PAN number. It does not matter who pays for it. Husband can pay for wife’s PPF irrespective of whether she is working or not working. Non-working wife may even pay for own PPF (e.g. through the gifts she gets from parents). But, once the investment is made, then it is investment for wife’s PAN. It has nothing to do with husband who paid for it. It does not matter who paid for PPF investment. The above is our understanding and we stick to it. If you feel comfortable with what Basunivesh has suggested, then you can follow their advice and invest in PPF accordingly.

                  Can we not clarify this with some bank official or some regulatory authorities in the interest of general public. Or if you have any confirmation from them?

                  regards,

                  Reply
                  • Amit-But the source of the funding is also important. It is now left with whom to rely.

                    Reply
                    • Sirji I think Amit has a valid point and needs to be explored.

  49. BASAVRAJ JI nice blogs to read and clarify queries.
    I read your earlier posts but still confused i have 2 kids. i have opened ppf account for me, my wife & both of my kids.
    kids being minor i am the father gaurdian by default no other choice to make my huf as gaurdian.
    Now, i have been depositing :
    deposit Rs.150000.00 my wifes ppf account from her bank,
    deposit Rs.150000.00 kid 1 ppf account from my bank,
    deposit Rs.150000.00 kid 2 ppf account from my huf,
    deposit Rs.150000.00 my ppf account from fathers huf
    every year since birth of my both kids 10 and 12 years of whom i am the leagal father and gaurdian by default
    i have been claiming under section 80 c for all the previous years.
    but from your blog came to know that being gaurdian of kids i have made mistakes under claiming the deposits under section 80c, now beacause aadhar and pan is to be linked with all the accounts this question arrises. Some Charterd accountant are saying you can deposit Rs. 150000.00 from huf’s bank and claim in huf return and deposit 150000.00 from your bank account and claim in your return, but as per your blog – being leagal gaurdian i can not claim the same and even not deposit 150000.00 in each account being gaurdian to my kids account . Please calrify. Thanks

    Reply
    • Sudarshan-CAs are right as in your case there is an individual and HUF accounts but not all accounts are individual.

      Reply
  50. Hi
    Me and my wife are employees. I have PPF account and investing for the past 4 years and claiming deduction. My wife don’t have PPF account and this time she wants to invest in my PPF account. Is she eligible to claim deduction under section 80 c for investing in my PPF account? If so, What’s the procedure? Please explain ..
    Thank you

    Reply
  51. I SUNITA BHATIA (SELF EARNED ) OPENED A PPF ACCOUNT IN AND MY HUSBAND OPENED PPF ACCOUNT IN MY DAUGHTERS ACCOUNT (WITH ME AS A GUARDIAN ) BUT PAID BY MY HUSBAND WHO DOES NOT HAVE ANY PPF ACCOUNT IS IT OBJECTIONABLE ?

    Reply
    • Sunita-Whether he contributes your account and your daughter’s PPF account (where you are guardian)?

      Reply
  52. ME AND MY WIFE BOTH ARE WORKING,
    HER TOTAL INCOME IS LESS THAN 2.5 LAKHS PA
    I HAVE DEPOSITED ABT 1.4 LAKHS IN HER PPF ACCOUNT BUT BY CASH.

    CAN I CLAIM TAX REBATE AS SHE DOES NOT QUALIFY FOR TAXABLE INCOME.

    Reply
  53. Sir, I just wanted to enquire that can I deposit 150000 in my own PPF account and also in my wife’s PPF account 150000 and vice versa my wife does the same act. Total 3 lacs deposited in both of our PPF accounts in a single financial year. No kids account. Is it possible because the bank people are not ready to except deposit more than 150000 per account. Please clarify sir

    Reply
    • Vaibhav-As the limit per account per financial year is only Rs.1,50,000, you are not allowed to invest more than Rs.1,50,000 in any PPF accounts.

      Reply
  54. Sir,
    With reference to Rs 6 lac investment example given above what I understand is
    Family must need 4 PPF accounts i e
    Husband, wife,one minor kid with husband as gargian and another minor kid with wife as a gargian to invest 6lacs in year. Am I right Sir?
    Reason to ask this is I got confused by query of Mr.Raj and your reply to it in above discussion.
    Regards

    Reply
  55. Hi Basavaraj,

    Thanks for sharing the information.

    Me and wife have invested in MF(SIP) for below funds and also we have FD(Tax saver) of 5 lakhs.

    Franklin Build India Fund
    Franklin India Prima Plus Fund
    Kotak Infra & Eco Reform Fund
    Mirae Asset Emerging Bluechip
    SBI BlueChip Fund-Reg(G)
    UTI Transportation & Logistics Fund(G)
    Franklin India Prima Plus
    SBI BlueChip

    Even I am having PPF account with my name but my wife doesn’t have.

    Now we have surplus of 15K/month, do you feel we can create PPF account for my wife(with minor account for my son) and start investing on this.

    Can you please suggest is it good to invest in PPF.

    Regards
    Anand

    Reply
    • Anand-Hard to say BLINDLY like which is best and how your portfolio looks.

      Reply
  56. Hello Sir,

    I caught something interesting here, let me know if it holds correct ??

    One can invest 1.5Lac in own (or as guardian combined) + 1.5L to wife account = 3L
    Now same Wife can invest 1.5L to own + 1.5L to husband = 3L

    So total per family its 6L (for a couple irrespective of they have kid or not) let me know if my understanding is correct ?

    Reply
      • Thank You, as most cases it was showing 4.5L or 6L in case they have 2 kids. So I was trying to clarify even its possible with 1 kid or without kid as well ?

        Reply
        • This may be debatable. As now all accounts are computerised and deposit in any single given account above 1.5 lacs during any FY is not accepted, irrespective of who deposits it. I was told in SBI that if any amount in excess of 1.5 lakhs in a year will not be accepted by the system. Need this to be clarified.

          Reply
          • Kishor-They might have developed the system. It is good also for investors.

            Reply
        • Raj-With or without kid, the rules are same. But do you think overboard too much with PPF a good investment strategy??

          Reply
          • Its good investment strategy for those who hold money in SB / FD accounts. With lower interest rates in FDs & added taxes on FD interest, make PPF more attractive but not comparable to MF, equities or other investment options.
            Whereas with market at peak one can be only optimistic while investing or do SIP for longer duration, but again the market is flooded with so many MF options becomes very difficult for one to take decision and expect their decisions will always be correct due to multiple factors involved.
            In recent there is herd mentality among many trying to dump money without understanding the whole model, at any possible option hence stocks are increasing in price without real growth factors. Despite some orgs posting good results stocks get beaten & some posting bad results get cheer up.
            So better to diverse with keeping in mind risk factors & underlying fundamentals.

            Reply
            • Raj-No product on this earth is BEST or WORST. You have to use the products or assets based on the financial goal. Thinking FD rates are low and market high and hence PPF is best does not mean you park all your 100% into PPF. Same applies to FDs or Equity Products.

              Reply
              • agree and echo the same diversification based on ones needs & risk apetite.

                Reply
  57. Hi sir my query is if a person has invested 1 lakh rupees .in 13,14,15 yr regularly in ppf ….can a investor withdraw all his money after completion of 15 yr..nd if yes than how govt will able to give tax rebate on 13,14,15 yr.bez on that amount their is nolockin ..nd how govt would calculate the intrest ..

    Reply
    • Anirudh-YES. It is the rule set by Govt and best for those who are about to close PPF at 15th year.

      Reply
  58. Hello Sir,

    Just a clarification:
    I am the guardian of my child ppf account.
    – I invested Rs 1,50,000 in my PPF
    – I invested Rs 150,000 in my child PPF
    – My wife invested Rs 1,50,000 in her PPF

    So my wife is taking Tax benfit – perfectly ok.
    I am just showing my PPF amount to claim tax benefit (not my child) but interest will be paid on both – my PPF & my child’s PPF —- Am i right, here?

    Reply
    • Anubhav-You are not allowed to invest in total Rs.3,00,000 into your and your kid where you are the guardian. The combined limit for these two accounts is Rs.1,50,000 only. If authorities come to know, then you lose the interest on any one account. Hence, abide by rules.

      Reply
      • Thanks for the feedback Sir ….. I was not aware of this PPF rule.
        I think i will not be able to withdraw the money for some years (PPF withdrawing rule) but i will take care of it from next financial years

        Reply
          • Sir, but if i take your case 1) to maximise the investment
            I will invest into my Kid’s PPF Rs 1.5L ( i am guardian) & my wife’s PPF Rs 1.5L
            And my wife will invest in my PPF Rs1.5 L
            so total will be 4.5 L without any breaking of Rule.
            Whether my understanding is correct??

            Also when i say i will invest to my kid & wife PPF but not mine it means i can give my signed cheque for investment or do online transfer to my wife & Kid PPF but not to mine. For my PPF my wife will do the same, right ??

            Reply
            • Anubhav-Yes, that you can do. You can invest in your kid’s PPF account. Let your wife invest in your PPF account and you in her account. You can either give the cheque or transfer through online but source of funding should be perfect as you said.

              Reply
              • Sir,
                It is not clear to me, if my wife is not earning anything then how can she invest in my account? Is there any option to my wife that she can do without falling in trouble?
                Thank you,

                Reply
                • Sanjay-To invest in your account, she must have her own earning.

                  Reply
              • That I can deposit up to a maximum of Rs150000 per year in my spouse’s account and the interest being tax exempt, clubbing is ineffective, is understood. Kindly advise the fate, for the purposes of taxation, of entitled withdrawal of proceeds by her on (i) maturity (ii) after 7 years (iii) during five year extende periods after 15 years. Thanks.

                Reply
      • It may sound lame question with so much discussion on topic,
        – If child’s account is linked with Mother’s PAN card means mother is guardian & if linked with Father’s PAN card father is guardian ?
        – If currently father is defined as guardian can it be updated to mother’s name or need to open new account? how ? (reason as you said one can invest max 1,50,000 into his + child) account.
        – How can the guardianship be defined for kid’s PPF, when both of them are guardians in real life ?

        Reply
        • Raj-
          1) Yes.
          2) You can’t change guardian in middle (especially if the guardian is alive) just for the sake of get maximum benefits.
          3) Legally only one person can be guardian, not both.

          Reply
  59. I did not get the 6 lakh calculation in the last example. Father will deposit 1.5 lakhs in two accounts a) First Child b) Wife. He will not deposit anything in his own account ? correct me if I am wrong..

    same way mother will deposit 1.5 lakhs in a) second child b) Husbands account.

    so u said .. all added will be 6 lakhs.. but if I see individual contribution from Father or Mother is 3 lakhs. 80 C allows only 1.5 Lakhs .. right ?

    So do u mean that .. the total investment will be 6 lakhs rupees which will be eligible for earning PPF interest rate but tax exemption can be taken only on 3 lakhs ?

    please clarify

    Reply
    • Aditya-Husband and his kid’s PPF combined limit is Rs.1,50,000. Same way, wife, and her kid’s PPF account is the limit of Rs.1,50,000. So here the family invested Rs.3,00,000 in total. Now husband and wife are free to invest in their spouse PPF account. Hence, another Rs.3,00,000. In total, the family invested Rs.6 lakh.
      Claiming tax benefits under Sec.80C is a different issue. What I am trying to say is how can you maximize without breaking the rule.

      Reply
    • 1.The deduction under section 80C is available to each Individual assesee
      2. Deposits to individual PPF account/s are restricted to up to Rs 150000 per financial year.
      Hence the deposits can be made accordingly to avail tax benefits by individuals within the deposit limits per PPF Account. Hence it will be prudent for an individual to deposit only Rs 150000 per year to a single PPF account.
      If additional PPF accounts are contributed to belonging to self/Spouse/children deposits in individual accounts cannot exceed Rs 150000 per FY.
      Operate within these guidelines please.

      Reply
  60. Hi, Thanks for sharing the information

    Reply
  61. What if Rs.150000/- is deposited by the Parent HUF in his child account and the HUF taking the benefit of sec.80c?

    Reply
    • Pankaj-It can be done so. But the combined limit for parent and child should not be again not more than Rs.1,50,000.

      Reply
      • Sir in my case i am seeking clarification for,

        if I invest Rs.1,50,000/- in my PPF account and
        my Wife invests Rs.1,50,000/- in her PPF account and
        my HUF invests Rs.1,50,000/- in my childs PPF account,

        then can all of us i.e. Me, My Wife & My HUF avail benefit of Section 80 C in their respective files?
        My point of doubt originates from the fact that the HUF can invest in PPF of its member and avail the benefit of sec. 80C.
        Kindly Clarify…
        Thanks

        Reply
        • Pankaj-Whether for your kid’s account you are the guardian?

          Reply
          • Yes. I am the Guardian.

            Reply
            • Pankaj-If you are the guardian, then the combined limit for you and your kid’s account is Rs.1,50,000.

              Reply
              • ok.
                What if I invest Rs.1,50,000/- in my PPF account and
                my Wife invests Rs.1,50,000/- in her PPF account and
                my HUF invests Rs.1,50,000/- in my child’s PPF account,
                0c
                and only my wife and my HUF claim deduction under sec 80C in their respective accounts?

                Reply
                • Pankaj-How can your HUF invest in child’s PPF when you are the nominee, not the HUF?

                  Reply
                  • Because I have read somewhere that HUF Can Pay on behalf of ‘Any Member of HuF’ (Whether Minor or Major). So the HUF can pay PPF for its Minor Member & Can Claim deduction under section 80C.

                    Reply
                    • Pankaj-ANY MEMBER OF HUF is ok. But here your account is HUF or Individual?

                    • Sir, I didn’t get your question.
                      What I am understanding is that my child is the member of my HUF. So the HUF can pay PPF for its Minor Member & Can Claim deduction under section 80C.

                    • Thanks Sir.

                      Thus in such a scenario, I in my individual capacity can also invest in PPF in my own account but cannot take deduction under 80 C. Correct?

                    • Pankaj-True and this is what I said in case of HUF in above post.

                    • From what I understand by comments of Mr. Pankaj & Mr. Basavaraj,

                      If we assume Father is Guardian of Minor child’s PPF Account.

                      Father -> Deposit Rs. 1,50,000/- in his own personal PPF account.
                      Father’s HUF -> Deposit Rs. 1,50,000/- in minor child’s PPF account.

                      Which makes the total deposit Rs. 3,00,000/-.

                      Have I understood correctly? If yes, then can the Father’s HUF deposit in more than one minor child account?

                    • Omkar-But here in above lines of PPF rules, they have not specified HUF. Hence, the above rule applies to both individuals as well as HUF.

  62. As per the MOF (DEA) letter No F.3(1)-PD/70 dated 24.9.1970 and N.S.C. Nagpur letter No. 12235/Tech/PPF/20-3/98
    dated: 20.7.1998,

    If contributions in excess of Rs. 1,50,000 are made during a year by the subscriber, the deposits in excess of
    Rs. 1,50,000 will be treated as irregular subscriptions and will neither carry any interest nor this excess amount
    will be eligible for rebate under Section 80C of the Income Tax Act. This excess amount will be refunded by the
    Accounts Office to the subscriber without any interest.

    Moreover as the PAN of the Guardian is given in Minor PPF account opening form, Rs.1,50,000/- is the combined limit for one of the parent and the child.

    Hence I think in a family, irrespective of the number of PPF accounts you may have, Only a maximum of Rs.3,00,000/- can be invested in a financial year.

    Reply
    • Alagappan-Please read the PPF rules properly. The combined limit for an individual with the account where he/she is a guardian is Rs.1,50,000. This is what your above comment also says.

      Reply
  63. Basunivesh, nice article. One more point is if Husband and Wife puts Rs 1.5 Lakhs each totalling to Rs 3 Lakhs per year for 15 years, total invested value is Rs 45 Lakhs (Rs 3 Lakhs x 15) and along with interest that amount can grow upto Rs 90 to Rs 92 Lakhs (depending on the interest rates in future)

    Reply
    • Suresh-Yes, you are right and thanks for your appreciation 🙂

      Reply
  64. I think in case of a minor child account the total sum of deposit in a year is maxm 150000 in both the accounts. Mean the total amount in both accounts is taken sumed up and maxm sum is 150000

    Reply
    • Govind-Whether you are guardian to one child or 10 children, the combined limit of all such accounts+your PPF should not cross Rs.1,50,000 a year.

      Reply
  65. Dear Sir,
    What are the rules of investment in case of NRI. I know that NRI’s are not eligible for PPF account. However, what if the husband is an NRI and the wife,child are resident Indian. The wife is not working and only source on income is husband earning.Can the wife and child open PPF account? What are the rules of taxation and maximum limit (for wife and child) in this case?
    Kindly provide details.
    Regards.
    Arun

    Reply
    • Arun-For all resident individuals, the rules are same. You can gift her and the same can be invested in her and your kid’s name (where she will be guardian).

      Reply
      • Does this mean ,NRE can Gift their wife 3 lac
        of which she can :

        Open Self account of 1.5 lac
        And other account on her Kids name where she will be guardian of 1.5 lac

        Reply
        • Sachin-You can gift either Rs.3 lakh or more than that also. But she in her account and your kid’s account invest to the maximum of Rs.1,50,000 ONLY.

          Reply
          • But as per below illustration in Case 3.
            She can open account of child where is guardian for 1.5 lac
            And also i can gift 1.5 lac which she can use it for her own self account.

            Kindly advice

            Reply
            • I guess Case 3

              Reply
            • Sachin-That is possible. But she on her own can’t deposit in her account as well as into guardian account.

              Reply
              • I didnt understand.
                Could you explain me how do i go about it.
                I am NRI and wife is house wife.
                At present she has PPF account for which transfer to her account.
                So now if i intend to open kid PPF Account where wife is gaurdian,how should i go about it ?

                Reply
                • Sachin-You have to transfer to her Bank account. In return let her deposit to into kid’s account. Let you deposit directly into her PPF account.

                  Reply
                  • Thank you

                    Reply
                    • Does that mean the following :

                      1. I deposit 1.5 lac from my NRE Account to her account. She then deposit in Child PPF account where she is the guardian
                      2. I deposit 1.5 Lac from my NRE account to her PPF account directly.

                      Am I right ?

  66. Dear Sir,

    I regularly contribute from my taxable income to a PPF account in my wife’s name & claim the 80C rebate in my income tax return.( this is allowed as per IT act).
    Now when this PPF account in the name of wife will mature, the entire sum received will be my Capital OR her capital?
    How will clubbing provision apply to sum received on maturity OR account closer?
    Can she further invest this money & earn from it without attracting clubbing provision to me.?

    Reply
    • Kishor-As per clubbing of income provision, it will be your income. However, PPF maturity is totally tax-free, you no need to pay any tax on such maturity.

      Reply
      • Mr.Kishore is asking whether the PPF maturity amount will be added to him or his wife? Please reply.

        Reply
        • Sankaranarayanan-If it is gifted with a proper document, then it must his wife’s maturity amount (But the tax liability is with him due to clubbing). Otherwise, it is HIS.

          Reply
          • So if I consider Amount contributed to wife’s PPF account as a gift given to her every year, entire maturity amount received on maturity will be her capital.

            I understood that due to clubbing provision, tax liability on income she received from my gift will be on me. But PPF earning is tax-free, hence no tax liability on me. And in turn, Entire amount receive by her on maturity will be her capital & she can invest it further suitably on her own name. Please correct me if I am wrong

            Reply
            • Kishor-Yes, your understanding is correct. After gifting and after maturity, whatever she invest from that maturity will be her income and tax liability of that will rest with her. Only PPF maturity taxation is on your head (as usual it is tax-free).

              Reply
              • Namaskar, i find your article informative. I have two kids boy 3 and half years and daughter one and half years. My wife is homemaker. Me my son and wife have ppf account. What could be the best combination for us. What may be the maximum combined depsit in FY. Kindly advise. Mriganka

                Reply
                • Dear Mriganka,
                  As your wife is a homemaker, she can’t invest in your PPF account. Hence, the maximum you can invest is Rs.3 lakhs only.

                  Reply

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