PPF Calculator – Public Provident Fund Calculator

How the PPF Calculator Works

The Public Provident Fund (PPF) is one of India's most trusted long-term savings instruments, backed by the sovereign guarantee of the Government of India. Launched in 1968 by the National Savings Institute under the Ministry of Finance, PPF was designed to encourage small savings while providing attractive, risk-free returns. It is available at all post offices and nationalised banks, making it accessible to virtually every Indian citizen.

This PPF calculator computes the maturity value by applying compound interest on each annual deposit individually. Every year's contribution earns compound interest for the remaining years until maturity. The deposit made in year one compounds for all 15 years, while the deposit in year 15 earns interest for only one year. The calculator sums the future value of each annual contribution to produce the total maturity amount. It also generates a year-by-year bar chart showing your cumulative investment versus total corpus, helping you visualise how compounding accelerates your wealth over time.

PPF enjoys EEE (Exempt-Exempt-Exempt) tax status under the Income Tax Act, meaning the annual contribution qualifies for a deduction under Section 80C (up to ₹1.5 lakh), the interest earned each year is completely tax-free, and the maturity proceeds are fully exempt from income tax. This triple exemption makes PPF one of the most tax-efficient instruments available in India. You can deposit between ₹500 and ₹1,50,000 per financial year, either as a lump sum or in up to 12 monthly instalments.

PPF Formula with Worked Example

The maturity value of a PPF account is calculated by summing the future value of each year's deposit. The formula for each annual contribution is:

Where P is the annual deposit, r is the annual interest rate (as a decimal), and n is the number of years that deposit remains invested. The total maturity value is the sum of FV for each year from 1 to the total tenure.

Example: Suppose you invest ₹1,50,000 per year for 15 years at 7.1% interest.

• Year 1 deposit: ₹1,50,000 × (1.071)¹⁵ = ₹4,17,276
• Year 2 deposit: ₹1,50,000 × (1.071)¹⁴ = ₹3,89,614
• Year 15 deposit: ₹1,50,000 × (1.071)¹ = ₹1,60,650
• Total invested: ₹1,50,000 × 15 = ₹22,50,000
• Maturity value: approximately ₹40,68,209
• Interest earned: approximately ₹18,18,209

This means your money nearly doubles over 15 years, with interest earnings representing about 81% of your total investment, all completely tax-free.

Key PPF Terms Explained

• EEE Status: Exempt-Exempt-Exempt refers to the triple tax benefit where the investment (under Section 80C), the annual interest, and the maturity proceeds are all exempt from income tax.
• Lock-in Period: The mandatory 15-year tenure during which the full balance cannot be withdrawn. Partial withdrawals are allowed from the 7th year onwards under specific conditions.
• Section 80C Deduction: PPF contributions up to ₹1,50,000 per year qualify for a tax deduction under Section 80C, reducing your taxable income by the amount invested.
• Compounding Frequency: PPF interest is compounded annually. The interest is calculated on the lowest balance between the 5th and the last day of each month, then credited at the end of the financial year (31 March).
• Extension in Blocks of 5 Years: After the 15-year maturity, you can extend the account in blocks of 5 years, with or without making further contributions. The extension must be requested within one year of maturity.

PPF vs Fixed Deposit (FD) Comparison

Both PPF and Fixed Deposits are popular safe-haven instruments in India, but they differ significantly in tax treatment, tenure, and liquidity. Here is a side-by-side comparison:

For investors in the 30% tax bracket, PPF's effective return of 7.1% significantly outperforms a 7% FD whose post-tax yield drops to around 4.9%. Use our FD Calculator to compare your specific scenario.

Practical PPF Investment Scenarios

Scenario 1: Maximum Investment for 15 Years

Ravi invests the maximum ₹1,50,000 per year for 15 years at 7.1%. His total investment is ₹22,50,000 and the maturity value is approximately ₹40,68,209. The interest earned of ₹18,18,209 is entirely tax-free, and his total Section 80C deductions over 15 years amount to ₹22,50,000.

Scenario 2: Modest Monthly Savings

Priya is a young professional who can save ₹5,000 per month (₹60,000 per year) in PPF. Over the 15-year mandatory period at 7.1%, her total investment of ₹9,00,000 grows to approximately ₹16,27,284. She earns ₹7,27,284 in tax-free interest. Starting early means she can extend her PPF for additional 5-year blocks to grow her corpus further.

Scenario 3: 25-Year Extended PPF

Amit opens a PPF account at age 30 and invests ₹1,50,000 per year for 25 years (15 + two 5-year extensions) at 7.1%. His total contribution of ₹37,50,000 grows to approximately ₹1,01,27,884 at maturity. He crosses the ₹1 crore mark with a completely tax-free corpus, demonstrating the power of extending PPF beyond 15 years. Plan your own scenario with our SIP Calculator to compare market-linked alternatives.

PPF Tips and Strategies

• Invest before the 5th of each month: PPF interest is calculated on the lowest balance between the 5th and the last day of each month. Depositing before the 5th ensures your money earns interest for that entire month.
• Make a lump-sum deposit in April: If possible, invest the full ₹1,50,000 in a single lump sum at the start of the financial year (before April 5). This maximises the compounding benefit as the entire amount earns interest for all 12 months.
• Use PPF as your debt allocation: In a balanced portfolio, treat PPF as the fixed-income or debt portion. Pair it with equity mutual fund SIPs for growth. This gives you a guaranteed floor for your retirement savings.
• Open a PPF account for your minor child: You can open a separate PPF account in your minor child's name (with you as guardian). However, note that the combined limit across your account and your child's is ₹1,50,000 per year for Section 80C purposes.
• Extend after maturity rather than closing: After 15 years, extending in 5-year blocks with contributions lets your corpus continue compounding tax-free. Closing the account means losing the compounding advantage permanently.
• Avoid loans against PPF unless necessary: While PPF loans are available from the 3rd to 6th year, they carry an interest rate of PPF rate + 1%. Exhaust other options first, as the loan reduces your effective compounding.

PPF Rules and Rates for 2026

• Current interest rate: 7.1% per annum (compounded annually), effective since April 2020. Reviewed quarterly by the Ministry of Finance.
• Minimum annual deposit: ₹500 per financial year. Failure to deposit the minimum results in a penalty of ₹50 per year and the account becomes inactive (can be revived).
• Maximum annual deposit: ₹1,50,000 per financial year. Deposits beyond this limit earn no interest and are not eligible for Section 80C deduction.
• Maturity period: 15 financial years from the year of account opening. Extendable in blocks of 5 years.
• Partial withdrawal: From the 7th financial year, up to 50% of the balance at the end of the 4th preceding year.
• Loan facility: Available from the 3rd to 6th financial year, up to 25% of the balance at the end of the 2nd preceding year, at PPF rate + 1%.
• Premature closure: Permitted after 5 years for medical emergencies, higher education, or NRI status change. A 1% interest rate penalty applies.
• Account holders: Indian citizens (resident and NRI) and HUFs. NRIs who opened PPF before becoming NRI can continue until maturity but cannot extend.

For a complete picture of your tax savings, use our Income Tax Calculator (India) to see how PPF deductions reduce your overall tax liability. Also explore the NPS Calculator for an additional ₹50,000 deduction under Section 80CCD(1B), and the RD Calculator for shorter-term recurring deposit options.