# PPF Calculator – How is PPF calculated?

What is PPF calculator? It is a simple calculation tool that is easy to use. Which can help in performing PPF related calculus easily.  This is a very useful tool with the help of which you can perform calculations related to all PPF accounts. And you do not need separate calculators like the SBI PPF calculator, PNB PPF calculator, India Post PPF calculator, or HDFC PPF calculator. This is because the interest rate, maturity, tax, and money withdrawal rules are fixed by the government, Therefore, PPF account should be opened anywhere but the rules are already decided.

## How to use PPF Calculator?

To use the PPF calculator correctly, you have to provide the following data:

• Period of PPF account – minimum 15 years to maximum 50 years (after 15 years you can extend the period after every 5 years).
• Deposit/payment period – This period can be selected as monthly, quarterly (every three months), half-yearly and yearly. Half-yearly deposits mean twice each year and similarly monthly means each month.
• Deposit amount – This is the amount to be deposited in the account according to the period of deposit. Thus if the deposit amount is Rs 1000. And the deposit frequency is monthly, the total PPF deposit for the year is Rs 12,000. is.
• Interest Rate – This is the rate of return that you are expecting on your investment. If you are wondering how to calculate PPF interest rate, don’t worry,

Once you have entered the above information in PPF calculator, click on “Calculate” to get information about PPF maturity amount, potential PPF interest, total PPF investment, etc.

## PPF calculation formula and rules

PPF calculation uses the compound interest calculation formula and the PPF principal amount is charged once a year. The following is the PPF calculation formula:

A = P (1 + R) * T

Where, A = PPF maturity amount, P = principal PPF amount, R = interest rate of PPF, T = period for which you are investing in PPF account. It is clear from the PPF interest calculation formula given above that the more you invest, the more interest you will get.

Following are some of the major rules:

You can get a maximum of Rs 1.5 lakh in a year. Can invest
You will get a minimum of Rs. 500 in a year. Can invest
Calculation of interest occurs at the end of every financial year
The maturity period of a PPF account is 15 years and the income is completely tax free.
The PPF rate changes every quarter (every three months) as per announcements made by the Ministry of Finance.

## Tax Benefits of PPF Investment

1.5 lakh in PPF Investment up to Rs is not taxed (as per Income Tax Section 80C). In addition, PPF investments are divided into EEE (rebate, rebate, rebate), which means that the original investment, maturity amount and interest are tax free.

## PPF loan calculation

Suppose you have spent Rs 10,000 in the last 3 years. If you have invested in PPF account every year, then your total investment amount was Rs 30000. While your maturity amount is Rs 34,994. is. At the end of that year you can pay Rs 2698. (25% of first year’s closing balance). Similarly, as per the existing PPF calculation rules, after 6 years, you can avail a loan of Rs 12137 (25% of the fourth year closing balance).

## Calculations for PPF investment period

ppf interest rate history

 Time Period PPF Interest Rate (p.a.) Q3 FY 20-21 (current) 7.1% Q2 FY 20-21 7.1% Q1 FY 20-21 7.1% Q4 FY 19-20 7.9% Q1 FY 19-20 8.0% Q4 FY 18-19 8.0% Q3 FY 18-19 8.0% Q2 FY 18-19 7.6% Q1 FY 18-19 7.6% Q4 FY 17-18 7.6% Q3 FY 17-18 7.8% Q2 FY 17-18 7.8%
• 15 years
• 20 years
• 30 years

The table is given as an example to explain how compounding works in your favor when it comes to PPF calculation.
In this example, we have assumed that the annual investment amount is Rs 10,000. And the interest rate of PPF is 7.9% per annum (current PPF rate till November 2019). The example above shows compounding while investing in PPF – if you invest in PPF for 30 years instead of 15 years then how does your maturity amount increase from Rs 2.9 to 12 lakhs. .

 Investment Period Total PPF Investment Total Interest Earned Maturity Value 15 years Rs. 1.5 lakh Rs. 1.4 lakh Rs. 2.9 lakh 20 years Rs. 2 lakh Rs. 2.88 lakh Rs. 4.88 lakh 30 years Rs. 3 lakh Rs. 9 lakh Rs. 12 lakh

### Rules for withdrawing money from PPF

PPF account matures after the completion of 15 years from the day the account was opened.  However, after the expiry of 6 years, PPF account holders can withdraw some money from their accounts. To withdraw money from PPF, the amount is calculated by automatic PPF calculator and can be withdrawn from the following amounts:

1.  50% of the balance amount of PPF account before the year of the loan application
2. 50% of the balance of PPF account in the fourth financial year before the year of the loan application

## How to understand the terms and conditions

The following is a list of terms that describe data in the results provided by the online PPF calculator that current and prospective PPF customers should know:

• Opening Balance: This is the PPF account balance at the beginning of the year
• Deposit amount: This is the amount that is present in the PPF account at the end of the year.
• Interest received: It is calculated at the end of the year based on the balance of the account. The balance in PPF account is maintained on an annual basis
• Closing Balance: The closing balance is added by adding the interest you earned in the current year and the money you put into the PPF account.
• Loan (maximum): PPF can be taken from 3 years to 6 years after opening an account. The maximum loan available is equal to 25% of the previous year’s PPF account opening balance. After completion of 6 years of opening a PPF account, no loan can be availed, although some money can be withdrawn if required.
• Withdrawal amount (maximum): After the completion of 6 years of PPF account, some money can be withdrawn from the account if needed. The maximum amount of this withdrawal should be 50% less than the closing balance of the previous year or 50% less than the closing balance of the fourth year of your account. The maximum withdrawal amount given by the calculator is calculated on the basis that you have not taken any loan in the previous financial year.
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