Q.1258 Information for NRI, PIO

& OCI holding PPF accounts in

India

Question: Dear Sir, My Question is: I used to be an Indian citizen and resident when I opened my PPF account. Now I am a Foreign citizen (OCI Holder) but still Indian resident who earns and pays taxes in India. When my PPF account completes 15 years tenure, can I continue to extend the same by 5 years or I need to withdraw the amount? I have asked the bank this but they are not very clear on the rules. Is there a website where the rules have been stated? Regards. Answer: The Indian Ministry of Finance, Department of Economic Affairs (DEA) had in October 2017 stated that when a resident holding PPF account becomes a non-resident (NRI) their PPF account shall be deemed to be closed effective the day he/she became a non- resident. However, on February 23, 2018 the DEA issued an office memorandum putting the earlier October 2017 notification regarding NRI PPF accounts on hold until further orders are issued in this regard. As per current rules NRIs, PIOs and OCI holders who hold PPF accounts can continue to hold them until maturity but they cannot extend their PPF beyond the maturity date. To view a copy of this notification click HERE

Information for those already holding PPF

accounts

The Finance Bill, 2018, has a provision to repeal The Public Provident Fund Act, 1968. All small savings schemes, as well as PPF accounts are to be covered under the Government Savings Banks Act, 1873. Clause 131 of the Bill seeks to insert a new section 16 to provide for repeal of the Government Savings Certificates Act, 1959 and the Public Provident Fund Act, 1968 and to bring existing schemes framed under these Acts under the Government Savings Banks Act, 1873. However, individual investors in these schemes need not worry as authorities have clarified that no existing benefits to depositors are proposed to be taken away.