Sep 302016

PPF Account Form H (Extend PPF Account Form)

If you are an earning person and if you are worried about your future, you must have thought of saving money. There are literally hundreds of investment options out there in market. From insurance to mutual funds, from share trading to government scheme – choices are so many that you will literally feel lost.

You aren’t alone in this cobweb. Every single person who thinks of investment, goes through this problem. So, how do you cope with it? You start with the safest option you have. PPF is the safest investment arena because it is government-backed.

So, if we are advising you on investing in PPF, there must be some solid reason for the same. Don’t you want to know? Yes, of course you do! We will skip the details of PPF because this article has a different purpose altogether. We will just give you a surface-touch view of PPF benefits and then you can Google for more details if you want to. But we are pretty sure that you already know about PPF. Consider this quick brush up as a refresher course for yourself.

So, what are the benefits of PPF which compels us to advise you for PPF investment? Here they are:

  • PPF is a government scheme. It was launched by central government of India. This means that PPF is immune to bankruptcy.
  • PPF allows loans. Don’t you take loans? How about loans at just 2% yearly interest? We have your attention right? Yes, PPF allows loan against standing balance at only 2% yearly interest. We are damn sure, no other financial organization in India can beat this rate.
  • PPF has provisions for premature withdrawal (though partial). This helps to deal with sudden financial cramps you can often experience in your balance sheet.
  • PPF follow EET rule of taxation. This stands for Exempt-Exempt-Taxed. What does that mean? It means that what you invest is not taxed. What you earn is not taxed. When you withdraw, you will be taxed. That is actually TDS or tax deduction at source.
  • PPF allows extension after maturity in 5-year blocks. No further investments are required but interest earnings continue.
  • PPF account cannot be liquidated by third party organizations (such as banks or other financial organizations). Even the court has no authority to pass a liquidation mandate on PPF account. Only government holds the right to do so to grab unpaid taxes or under other circumstances as deemed fit by the government. This however doesn’t happen unless you have tons of pending tax payments.
  • A yearly minimum of 500 rupees of deposit as mandated by PPF guidelines makes PPF a very easy-maintenance investment.

Now that we have covered some of the most vital benefits of PPF, we need to divert our attention to the actual topic of this article. So, what is this PPF Form H? This form is connected to one of the benefits mentioned above. Can you guess?

Well, we will spare you the trouble. This form is related to extension of PPF account post maturity. So, let us take a look at Form H.

All About PPF Form H

Let us lay down the ground works for elaborating on the Form H of PPF. We mentioned in one of benefits above that PPF account can be extended for a period of 5 years. Let us give you an example.

Let us assume that you opened your PPF account on 1st April, 2001. The account matured after completing 15 years of tenure. So, the account matured on 31st March, 2016. Now you want to keep the account instead of withdrawing the entire amount. In such a case, the following things can happen:

  • You can extend your account till 31st March, 2021.
  • You will not be allowed to make any further investments in the account.
  • Whatever money is present in the account will continue to earn interest.

Let us fast forward and assume that today is 31st March, 2021. Today you decide that you want to extend your PPF account again. In such case:

  • You can extend the account till 31st March, 2026.
  • Again, no further investments will be allowed.
  • Interest earning will continue.

You can do this as many times as you want. Just remember that:

  • Every time you decide to extend your account, your account gets locked for 5 years.
  • During these 5 years of extension, you cannot withdraw any funds. Not even partial withdrawal.
  • The account can be extended only in 5-year blocks – no less no more.
  • For further extension, you will have to make fresh application using Form H.

Hopefully we have explained properly how extension of PPF account works. Now, let us take a look at the Form H itself. As we said, this form is specifically designed for extension of PPF account. No other form can be used. But, what’s there in the form?

As a matter of fact, Form H is the easiest or simplest of all PPF forms.  There are only a few elements that you need to take care of. Let us take a look at each of the elements of the form in details.

You can download SBI PPF Form H from this link .

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