PPF Withdrawal Rules: How to Withdraw Your Money?

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PPF Withdrawal

Public Provident Fund helps to mobilize small savings in the form of investments. The main issue one faces is the long duration which is 15 years. But, PPF scheme allows withdrawal before completion of maturity as well. The common questions we address in this blog are when can I withdraw money from PPF? What amount can be withdrawn before maturity? What is the process for withdrawal from PPF? Do withdrawal rules differ from bank to bank? Let us discuss all these in detail.

Withdrawal from PPF

PPF account closure can be done only upon maturity, which is after completion of 15 years. The entire amount standing to the credit of PPF account gets credited to the account holder along with accrued interest. When the account holder is in needs of funds, he can withdraw the same as it permits partial withdrawals from 5th year.
Amount that can be withdrawn
Type of Withdrawal
Reason for withdrawal
When to withdraw
50% of balance
Partial withdrawal
Any reason
After five years
Full amount
Premature closure
Medical, education
After five years
Full amount
On maturity
Any reason
After 15 years

This table easily clarifies about partial withdrawals and premature closure after 5 years. But, premature closure is only allowed on specific education and medical grounds.
The maximum amount that can be withdrawn per financial year is lower of the two:
a)      50% of account balance at the end of financial year, preceding the current year
Or
b)      50% of account balance at the end of 4th financial year, preceding the current year.


Extension of PPF Withdrawal

You can also choose to extend the withdrawal from your PPF account. You can extend the tenure of PPF account in blocks of 5 years for as long as you want to. The biggest benefit of extension is that the account continues to earn interest on the accumulated balance.

How to Withdraw Money after Simple Extension?

When you have extended PPF account for five years; you can withdraw money up to the balance in the account at the time of extension. For example, you have accumulated Rs. 1000000 in your PPF account before extension and thus, can withdraw the same. In addition to this, only one withdrawal is permitted in one year.

How to withdraw money after extension with contribution?

Firstly, we need to understand what is extension with contribution? This lets you contribute fresh money to PPF account and get interest on it along with existing money. You need to submit Form H to extend the PPF account within one year of the original maturity of PPF account. After extension of PPF with contribution, you can withdraw 60% of the balance accumulated at the time of extension. Also, you can withdraw once a year. For example, For example, you have accumulated Rs. 1000000 in your PPF account before extension and thus, can withdraw 60% of it, i.e. Rs. 600000.

Do I need to pay tax on PPF Withdrawals?

PPF withdrawal is completely exempt from tax whether it is partial withdrawal or withdrawal on maturity.

Have any queries regarding withdrawing money from PPF? Feel free to ask in the comments section.

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