A Public Provident Fund (or PPF) account matures in 15 years. But it’s not necessary for you to close the account. You can extend it too. How many times can you extend your PPF account after maturity?
After maturity of the 15-year lock-in period, you can extend your PPF account by a period of five years blocks. You can extend in blocks of 5 years at a time for as many times as you want. There is no limit on the number of times you can extend your PPF account after maturity. So once the 15 years is complete, you can further push back the PPF maturity to 20 years, 25 years, 30 years, or till whenever you want to.
If you decide not to withdraw the entire PPF corpus amount (close the account on maturity) and go for an extension of the PPF account, then you have 2 more options to choose from:
- Extend by 5 years WITHOUT further contributions: If you choose this option, then your PPF account’s maturity will be extended by 5 years. You will not be allowed to make any fresh contributions during this extended 5-year period. But your existing PPF corpus will continue to earn interest. And what if you need some money during these five years? Don’t worry, you are allowed to make one withdrawal per financial year. So let’s say your PPF account completes the 15-year period and has Rs 30 lakh. You can withdraw any amount lower than this amount once a year. So, you have this flexibility to make one withdrawal per year. By the way, if you don’t inform about your choice after 15 years of maturity, this is the default option chosen and applied to your PPF account.
- Extend by 5 years WITH further contributions:If you choose this option, then in addition to extension of maturity by 5 years, you are also allowed to make regular contributions to your PPF account during the extension period. And what about making withdrawals during this five-year period with contributions? You can withdraw a maximum of up to 60% of the account balance at the start of the 5-year extension period. So let’s say your PPF account had Rs 20 lakh at the end of 15 years and you extended it with contributions; then, you can withdraw a maximum of Rs 12 lakh (which is 60% of Rs 20 lakh). The fresh contributions that you make in the PPF account during the extended period will be eligible for deduction under Section 80C of the Income Tax Act.
So can PPF be extended after 15 years? Yes. Can PPF be extended after 20 years? Yes. Can PPF be extended after 25 years? Yes. Can PPF be extended after 30 years? Yes. So how long a PPF account can be continued? You can keep extending your PPF account in blocks of 5 years for any number of times you want.
Those are the latest PPF Account Maturity and Extension Rules 2022.
So here are answers to a few related questions:
- Can PPF be extended indefinitely? Yes, you can extend your PPF account on maturity in blocks of 5 years any number of times you want.
- What can I do after PPF maturity? You have 3 options. One is to close the account and take all the money accumulated in the PPF account. Second option is to extend it by 5 years without contributions. The third and final option is to extend it by 5 years with contributions.
I remember I once received a query from a reader. It was something like this – My PPF account is maturing soon. Should I extend it or close it and open a new PPF account? I think the answer is pretty simple. If you don’t need the full PPF account balance in one go, then its best to extend it. That too I would suggest extending with contributions as PPF is still a solid, tax-free, EEE status savings option. And the longer you keep rolling it by extending, the better returns you will get due to the compounding effect. Here is how you can become a real-life PPF Crorepati.
Further Reading: Use this Free Excel-based PPF Maturity Corpus Calculator (download).
Also, there is no difference in the interest rate of a new PPF account vs old extended PPF account. So you may ask as to Can I open new PPF account after maturity? I would say that unless really required or you are in a special circumstance, I don’t recommend closing the existing PPF account after maturity and opening a new one. It makes no sense.
I have written quite a few articles on PPF that you can consider for further reading:
- PPF: Before 5th Vs After 5th of Month?
- Why Invest Rs 1.5 lakh in PPF before 5th April?
- How PPF Account Interest is calculated?
- PPF Interest Rate History
- Is taxable PF interest (Rs 2.5 lakh) rule applicable to PPF?
- VPF Vs PPF
- NPS vs PPF
- PPF vs ELSS
- TDS on PPF Withdrawal
- PPF Withdrawal & Loan from PPF Account
- Can you open both Sukanya Samriddhi and PPF accounts for Daughter?
- Can NRI invest in PPF?
So I hope you are now clear about the PPF account extension rules and have clarity about How many times can you extend PPF account after maturity? And depending on your needs, you can decide whether to close PPF account after maturity or to extend it.