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Business Desk – Children’s PPF Account: Public Provident Fund (PPF) scheme is a very popular means of investment among the common people. Under this government scheme, people can earn good returns in the long run by investing small amounts. A special feature of the PPF scheme is that it provides the facility to open PPF accounts for children also.

Although it is possible to invest in such accounts, are the rules of children’s PPF accounts different from those of adults? Also, what is the actual procedure to open a PPF account for a child? Today we will give you all the information about this. Come, let us know in detail.

PPF scheme for children

Parents can open PPF account in the name of their minor children. Can invest in it. The rules governing these accounts are not much different from the accounts of adults. Returns on children’s PPF account are also available at the current rate of 7.1%. In terms of investment rules, interest earned and maturity process, everything is quite similar to a normal PPF account.

How to open PPF account for a child

To open a PPF account for a child, parents can visit a post office or a bank branch. Apart from this, some banks also provide the facility to open these accounts online. This process generally requires common documents like Aadhar card, address proof and passport size photographs.

For a minor child, the account has to be opened by his/her parents or legal guardian, once the child turns 18 years of age, he/she can manage the account himself.

The maximum limit for investment every year in a child’s PPF account is fixed at Rs 1.50 lakh. It is important to note that both parents cannot invest Rs 1.50 lakh separately. Both the parents together cannot invest more than Rs 1.50 lakh every year in the child’s account.

The amount deposited in the child’s PPF account is considered a “gift”. Although the interest earned is directly credited to the child’s account, the interest earned can be added to the taxable income of the parent whose income is higher.