How to withdraw partially from PPF?

Public Provident Fund (PPF) is one of the most common and safest government-backed tax-saving investment instruments. It has a tenure of 15 years. However, if the need arises, one is allowed to make partial withdrawals after completing five years from the financial year in which the account is opened. For example, if one opens a PPF account in 2015-16, he will be allowed to make partial withdrawals from the financial year 2021-2022.

But one must note that even after five years, there are certain restrictions on the amount that can be withdrawn. The amount eligible for withdrawal is lower of -

• 50 per cent of the account balance as at the end of the financial year, preceding the current year, or
• 50 per cent of the account balance as of the end of the 4th financial year, preceding the current year.

For example, if you wish to withdraw partially in July, 2022 (FY 22-23), the maximum amount that can be availed as the loan would be lower of:

• 50 per cent of the balance as on March 31, 2022 (FY 21-22), which is the preceding year to FY 22-23, or
• 50 per cent of the balance as on March 31, 2019 (FY 18-19), which is the 4th financial year preceding FY 22-23.

Withdrawal procedure
You can withdraw by submitting Form C at the nearest post office or bank. Form C must be filed with all the required information, such as the PPF account number, the amount to be withdrawn, and the total number of financial years completed since the PPF account was opened. Here's what From C from the SBI looks like.

A revenue stamp has to be affixed to the form and the PPF passbook needs to be submitted along with the withdrawal application. The bank/post office will verify the date of account opening to ascertain eligibility for withdrawal. If eligible, the withdrawal amount will be calculated and credited to the subscriber's bank account. Partial withdrawals are not liable for tax.

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