PPF Account for Minors

PPF age limit for minors: In India, there’s no specific age restriction for opening a PPF account for minors. Even newborns can have one, with guardians managing it until they turn 18, when they assume full control.
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PPF for minors
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4 mins
15 November 2024

PPF is a government-backed initiative. It provides a secure avenue for systematic savings among Indian residents. It also extends its reach to the younger generation, offering the option to open a PPF account for minors.

This article dives into the rules, eligibility, and practical aspects of opening and managing a PPF account for minors. It offers valuable insights to help parents in building a strong financial foundation for their children.

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What is the PPF scheme?

The Public Provident Fund (PPF) scheme is a government-backed long-term savings and investment initiative. It is designed to encourage systematic savings among individuals. Established by the Finance Ministry’s National Saving Institute, the scheme provides a secure and tax-efficient investment avenue for Indian residents.

What is a PPF Account for Minors?

A PPF (Public Provident Fund) account for minors is a savings scheme in which parents or guardians can open and operate an account on behalf of a minor. It helps in building a long-term savings corpus for the minor's future needs.
A PPF account for a minor can only be opened by their natural or legal guardian, and the scheme is available only for Indian citizens.

PPF age limit for minors

There's no specific age limit for opening a PPF account in India. Even infants can have their own PPF accounts, managed by a guardian until they turn 18. After reaching adulthood, the minor can take full control of their account.

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Minor PPF account rules and eligibility

  • Only Indian residents can apply and open Public Provident Fund accounts.
  • The account can only be opened by one of the guardians.
  • The person managing the account on behalf of the minor must be a natural or legal guardian.

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How to open an PPF account for minors?

  1. PPF account for minors can be opened at any designated banks or post offices.
  2. Fill out the PPF account opening form with details of the minor and the guardian.
  3. Submit necessarily Know Your Customer (KYC) documents of both the minor and the guardian.
  4. Deposit the initial amount. Minimum deposit starts from Rs. 500 in a financial year and maximum deposit is Rs. 1.5 lakh in a FY.

Documents required to open a minor’s PPF account

The parents/guardian of the minor child should provide the following documents:

  • Details of the guardian and minor in the account opening form
  • KYC documents (Passport, Voter ID, Aadhar card, Driving license) of the guardian for opening account.
  • Guardians photograph.
  • Age proof (Aadhaar Card or birth certificate) of the minor child.
  • A cheque for initial contribution of Rs. 500 or more in the PPF account.

Also read: NPS vs PPF

Things to be considered before opening the PPF account of a minor

  1. A PPF account for a minor can be opened with a minimum initial amount of Rs. 500, and the maximum one can deposit is Rs. 1.5 lakh in a year.
  2. If the invested amount is from the parent/guardian's income, it qualifies for tax benefits under Section 80C of the Income Tax Act.
  3. When the minor reaches 18, it is mandatory to apply for the account transfer from the guardian. The application, along with necessary documents, requires the signature of the individual (minor) who has reached the age of 18 and approval of the guardian who opened the account.
  4. Closure of the minor's PPF account is possible after 5 years, primarily for account holders’ medical needs.
  5. Premature closure is allowed for the minor's higher education expenses.

Conclusion

Opening a PPF account for minors presents a unique opportunity for parents to secure their children's future. Exploring the rules, eligibility, and key considerations outlined in this article helps parents to make sound financial decisions for their children's future.

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Frequently asked questions

What happens to the PPF account when a minor turns 18?

When a minor turns 18, the PPF account undergoes a change in status. The parent or guardian must file an application for this change, and thereafter, the account holder manages all subsequent activities.

What is the minimum age for opening a PPF account?

There is no minimum age for opening a PPF account; both adults & kids can open a PPF account. However, in the case of a child under the age of 18, accounts should be handled by his or her guardian until he/she turns 18.

What are the minimum and maximum amounts required to open a PPF account for a minor?

The minimum initial amount to open a PPF account for a minor is Rs. 500, and the maximum annual deposit allowed is Rs. 1.5 lakh per year.

Is there a particular age to start the PPF account?

There is no age limit even to open PF account. Even PPF can opened for minors which will be handled by his/her parents or legal guardian.

What is the minimum amount to open a PF account for a child?

The minimum amount to open a PF account for a child is Rs. 500.

What to do when the minor PF account holder turns 18?

When the minor account holder turns 18, parent or legal guardian need to submit the necessary documents with all the required signature and convert the PPF account into a regular one.

Can money be withdrawn from the PPF account for minors?

Withdrawals from a minor's PPF account are allowed after 7 years of account opening. The guardian must sign a declaration stating that the amount withdrawn is solely for the minors use.

What happens when more than Rs. 1.5 lakh are being deposited into a PF account?

If more than Rs. 1.5 lakh are deposited into a PF account, the excess amount won't earn any interest, and it doesn't contribute to tax benefits under Section 80C.

Is pan mandatory for minor PPF?

No, PAN is not mandatory for opening a Public Provident Fund (PPF) account for a minor. Instead, the guardian's PAN is required when completing the application process for the minor's PPF account.

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