EPF (Employee Provident Fund) | PPF (Public Provident Fund) |
Employee Provident Fund, EPF is also commonly known as Provident Fund, PF. It is the arrangement for the salaried individuals where a stipulated part of their salary is deducted and kept in their EPF account. |
Public Provident Fund is a scheme open to those who don’t have a regular Salary. One can voluntarily decide to open it and manage it. Mostly, PPF is for the consultants, freelancers, or even the people who don’t have an assured income. |
Any Individual who is salaried and employed can be eligible to become a member of EPF scheme on the date of joining the employment. |
Any individual can open a PPF account with the assistance of nationalised banks or post offices that handle PPF accounts. |
Employees who earn a basic salary of up to Rs. 15,000 contribution to EPF is mandatory. Typically 12% of the Basic, DA, and cash value of food allowances has to be contributed to the EPF account. |
You need to deposit a minimum of 500/- in order to open the account. The maximum amount you can deposit per annum is 1,50,000. |
The interest of 8.65% per annum is received by the employee having EPF. The rate is prescribed by the government and revised every year. |
You receive the annual interest of 8% in a PPF account. This rate is revised periodically by the Central Government. |
The accumulated amount in the EPF is paid at the time of retirement or resignation. It can be transferred from one account to another in case of a change in jobs. How to transfer EPF Balance? |
The entire amount saved through PPF can be withdrawn after 15 years. One can also extend it to the five years’ period. |
Premature withdrawal in EPF will attract tax subject to certain conditions. |
In PPF premature withdrawal is not allowed. |
If certain conditions are satisfied, then a lump sum amount received is exempt from tax. |
The amount received after the maturity period is completely tax-free. |
Investment in EPF is eligible for tax deduction under section 80C. |
Investment in PPF is eligible for deduction under section 80C. And the interest earned on PPF account is completely tax-free. |
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