PPF Calculator 2026: Maturity, Loans, Withdrawals & Extension Rules Explained

Public Provident Fund (PPF) is India's most trusted savings instrument — government-backed, tax-free, and offering 7.1% guaranteed returns in 2026. Yet most investors only know the surface level: invest ₹1.5L per year, lock in for 15 years, get tax-free maturity. The real power of PPF lies in features very few people use correctly: loans, partial withdrawals, and strategic extensions.

Calculate Your PPF Maturity Now

Before diving into the rules, use our calculator to see your personal numbers:

Why PPF at 7.1% is Actually Better Than FD at 8%

The most common misconception: 'FD gives 8%, PPF gives 7.1% — FD is better.'

This is wrong once you account for tax. PPF interest is 100% tax-free. FD interest is taxable as per your slab:

• 30% bracket: FD at 8% → effective return = 5.6% (after tax)
• PPF at 7.1% → effective return = 7.1% (zero tax)

PPF wins by 1.5% for high-income earners. Over 15 years on ₹1.5L/year, that 1.5% difference compounds to approximately ₹7-9 Lakhs more in your pocket.

Year-by-Year PPF Growth (₹1.5L/year @ 7.1%)

Notice how interest-earned accelerates each year — this is compounding at work. The interest in Year 15 alone (₹1.96L) is more than 1 year of your deposits!

PPF Loan Rules: Available Years 3 to 6 Only

This is where most people are surprised. You can borrow against your PPF balance — but only between the 3rd and 6th year of your account:

• Maximum loan: 25% of balance at end of the 2nd preceding year
• Interest rate: PPF rate + 1% = currently 8.1% p.a.
• Repayment: Within 36 months (in 2 installments)
• Second loan: Only after the first is fully repaid

After Year 6: Loans are no longer allowed — but partial withdrawals open up.

Partial Withdrawal Rules: From Year 7 Onwards

Starting from the 7th financial year of your PPF account:

• How much: Up to 50% of the lower of — (a) balance at end of Year 4, or (b) balance at end of immediately preceding year
• How often: Only once per financial year
• Tax on withdrawal: Completely tax-free

Practical example: If your Year 4 balance was ₹7L and your current balance is ₹22L, you can withdraw up to ₹3.5L (50% of ₹7L — the lower figure).

What Happens After 15 Years? (3 Options)

Most investors assume they must close their PPF account at maturity. They're wrong:

Option 1 — Close the Account: Take full tax-free maturity amount. Do this only if you genuinely need the money.

Option 2 — Extend WITHOUT Contributions: Your balance continues earning 7.1% tax-free with zero paperwork, zero new deposits. This is the easiest wealth-building move — passive compounding.

Option 3 — Extend WITH Contributions: Submit Form H to your bank within 1 year of maturity. Continue fresh deposits (still get 80C deduction). Extend in 5-year blocks indefinitely.

The math on Option 2: If you have ₹40L at maturity and simply leave it at 7.1% for another 10 years without depositing a single rupee, it grows to ₹80 Lakhs — completely tax-free.

Frequently Asked Questions

Can NRIs open a PPF account? No — NRIs cannot open new PPF accounts. If you opened one before becoming NRI, you can maintain it until maturity but cannot extend it.

Can I open a PPF account in my child's name? Yes — you can open a PPF account for a minor child. However, the combined deposit across your account + child's account must not exceed ₹1.5L/year for 80C benefits.

What if I miss a year? Your account becomes 'inactive'. To reactivate it: pay ₹50 penalty per inactive year + ₹500 minimum deposit per inactive year. Your existing balance still earns interest during inactivity.

Conclusion: PPF is not just a tax-saving instrument — it's a lifetime wealth-compounding machine. Maximize it early, use the loan feature if needed (years 3-6), withdraw strategically after year 7, and never close it at 15 years unless absolutely necessary. Use the PPF Calculator to model your specific scenario.