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PPF account for minors

Any eligible individual can open a PPF account and invest money in it. Not only adults, but minors can also get their PPF account opened. However, the minor himself cannot open the account. In such cases, the account is operated by the guardian until the minor turns 18.

PPF Account Eligibility for Minors

• A minor’s legal guardian or natural guardian (i.e. mother or father) who is an Indian resident can open a PPF account on behalf of the minor.
• Only one of the guardians i.e. either mother or father can open the account on behalf of the minor.
• PPF accounts cannot be operated by the minor's grandparents unless they become their legal guardians (after the death of the parents).

Documents Required

The guardian or parent of the minor should provide the following mentioned details in the account opening form.

• The details of the guardian and minor in the account opening form
• Account opening KYC documents of the guardian along with the latest photographs
• Age proof (Aadhaar card or Birth certificate) of the minor child
• A cheque for initial contribution to the PPF account of Rs. 500 and above

Where can you open the account?

PPF accounts can be opened with a post office or a designated bank branch that is authorized to open PPF accounts.

Taxation

Both the interest accrued along with the maturity amount is exempt from tax in the hands of the account holder. Contributions made towards a PPF account enjoy a deduction of up to Rs 1.5 lakh each financial year under Section 80C. However, it must be noted that only one PPF account (either of the guardian or the minor) can avail of a deduction limit of Rs. 1.5 lakh.

Important Points to Note

• The amount of the deposit in a PPF account should not exceed Rs 1.5 lakh in a financial year. 
• If the amount invested in the minor’s PPF account is from the income of the parent/guardian, then that amount can be included under Section 80C of the Income Tax and will be eligible for tax benefits
• It is mandatory to transfer the account from the guardian to the minor as soon as they attain 18 years of age. 
• A depositor can also close the minor’s PPF account under certain specific conditions such as any emergency medical purpose, for the minor's higher education, etc.
• The depositor can also avail of a loan against a PPF account if that amount is used for the welfare of the minor.