a) Close the account and withdraw entire proceeds
b) Extend the account without fresh deposits
c) Extend the account with fresh deposits
Here is a closer look at each of these options.
- Closing PPF account and withdraw entire maturity amount
After the expiry of the mandated 15 years, an individual can close his/her PPF account. It is important to note that the date of opening of PPF account will not determine the maturity date. As per the PPF scheme rules 2019, the maturity date of PPF account is after 15 years from the end of the financial year in which initial subscription was made.
For instance, if a PPF account is opened on July 20, 2009, then as per the scheme rules, the account will mature after 15 years from the end of the financial year in which account was opened. The maturity date of PPF account will be April 1, 2024. To close the account, the PPF account holder will have to submit an account closure form.
- Extending PPF account without new deposits
A PPF account holder can continue his/her account after maturity without making any further deposits. The account can be continued for any period. The PPF account will continue to earn interest rate applicable to the scheme.
An account holder can make a withdrawal every year of any amount from the balance available in the account.
Do note that once the account is continued without new deposits for more than a year, then the account holder does not get the option to continue again with deposits.
- Extension of PFF account with fresh deposits
Post maturity, PPF account can be extended with fresh deposits. The account can be extended for a block of five years. The account can be extended for one or more five-year blocks. Once this option is exercised then, he/she cannot withdraw his/her request at a later stage.
An account holder is required to inform the bank/post office about the extension of PPF account with fresh deposits before the expiry of one year from the maturity.
If the account holder fails to inform the bank/post office about continuing the account with fresh deposits within one year from date of maturity, then no deposits can be made in that account.
Once the PPF account is extended with deposits, an individual can withdraw maximum 60% of the balance in one block of five years. The withdrawal can be made either in single or in yearly instalments.
Do note that as per PPF scheme rules, if the account is continued for deposits for one or more five-year blocks, then the account holder may leave the account without deposits on completion of any block. The account shall continue to earn interest till it is closed. The account holder can make one withdrawal every year from the account.