PPF Withdrawal Rules 2025 — Partial, Premature & Maturity

Updated: June 2025 | PPF Scheme 2019 | Ministry of Finance

Quick Answer: PPF (Public Provident Fund) has strict withdrawal rules. Full withdrawal is only permitted after the 15-year lock-in period. Partial withdrawal is allowed from the 7th financial year onwards — up to 50% of the balance at the end of the 4th year or end of the preceding year, whichever is lower (once per financial year). A loan against PPF is available from the 3rd to 6th year (up to 25% of the balance). Premature closure is allowed only in special circumstances (life-threatening illness, higher education, change of residency) from the end of the 5th financial year, with a 1% interest penalty. All PPF withdrawals and maturity proceeds are fully tax-free.

Year 7

PPF partial withdrawal starts from the 7th financial year — up to 50% of the eligible balance, once per year, completely tax-free.

PPF Withdrawal Timeline — When, How Much & Conditions

The PPF Scheme 2019 defines clear rules for each type of withdrawal based on how many years the account has been open.

Year / Period	Type of Access	How Much	Conditions
Year 1 – 2	None	No withdrawal or loan	Complete lock-in
Year 3 – 6	Loan only	Up to 25% of balance at end of 2nd year preceding current year	Loan must be repaid within 36 months; 1% interest above PPF rate. No fresh loan until existing one is cleared.
Year 7 onwards	Partial withdrawal	Up to 50% of balance at end of 4th year OR end of preceding year — whichever is lower	Once per financial year; submit Form-2 to bank/post office; no reason required
Year 5 onwards (special cases)	Premature closure	Full balance — with 1% interest penalty	Only for: serious illness of account holder / spouse / dependent children; higher education of account holder or minor; change of residency / NRI status
End of Year 15 (maturity)	Full withdrawal	Entire corpus	Submit Form-C to bank/post office; or extend account

PPF Maturity Extension Options

At the end of 15 years, you have three choices. Extension can be done in 5-year blocks any number of times.

Option	What Happens	Withdrawal Rules During Extension	Action Required
Close the account	Full corpus withdrawn; account closed	N/A — account closed	Submit Form-C within 1 year of maturity
Extend without contributions (passive extension)	Account continues earning interest; no new deposits	Can withdraw any amount once per year; balance may not fall to zero (1 withdrawal per year)	Do nothing — account auto-extends passively
Extend with contributions (active extension)	Continue depositing ₹500–₹1.5L/year; account earns interest	Partial withdrawal: up to 60% of balance at start of each 5-year block (over the 5 years)	Submit Form-H within 1 year of maturity; elect to continue with contributions

Is PPF Withdrawal Taxable?

PPF enjoys EEE (Exempt-Exempt-Exempt) tax status — arguably the best tax treatment of any savings instrument in India:

Contribution exempt: Up to ₹1.5 lakh deductible under Section 80C (old regime).
Interest exempt: Annual interest credited is fully exempt under Section 10(11) — not added to income.
Withdrawal/Maturity exempt: All withdrawals — partial, premature (if allowed), or at maturity — are completely tax-free.

Note: In the new tax regime, Section 80C deduction is not available, but the interest and withdrawal remain fully exempt.

Frequently Asked Questions

When can I withdraw from PPF?

Full withdrawal is only possible at maturity — after 15 financial years from the year the account was opened. Partial withdrawal is allowed from the 7th financial year (6 years completed). Premature closure is permitted from the end of the 5th year in special cases (medical emergency, higher education, NRI status change).

How much PPF can I withdraw in a year?

From Year 7 onwards, you can withdraw up to 50% of the lower of: (a) balance at the end of the 4th preceding year, or (b) balance at the end of the year immediately before the withdrawal. Only one withdrawal is allowed per financial year. There is no minimum withdrawal amount.

Can I close my PPF account before 15 years?

Yes, but only from the end of the 5th financial year and only for specific reasons: (1) life-threatening disease of account holder, spouse, or dependent children; (2) higher education of the account holder or minor child; (3) change in residency status (becoming NRI). A penalty of 1% reduction in interest rate is applied on the entire tenure. You cannot close PPF prematurely just because you want the money.

PPF loan vs PPF withdrawal — which is better?

PPF loan (available Year 3–6) lets you borrow up to 25% of balance and repay within 36 months — your principal stays intact and keeps earning interest. PPF partial withdrawal (from Year 7) is simpler and there is no repayment obligation, but it reduces your corpus permanently. For short-term needs in Years 3–6, a loan is the only option. After Year 7, partial withdrawal is preferable for most people as it is cheaper (no interest on "borrowing") and simpler.

Is PPF withdrawal taxable?

No. PPF has EEE (Exempt-Exempt-Exempt) tax status. Interest earned is exempt under Section 10(11), and all withdrawals — partial, premature, or at maturity — are fully tax-free. You do not need to show PPF withdrawal in your income tax return as income. Only the Section 80C deduction on contributions is unavailable in the new tax regime.

Ppf Withdrawal Near You

Expert CA/CS assistance for ppf withdrawal across India. Click your city for local details.

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