Maximum amount of investments per year in ppf accounts

Save Share

This query is : Resolved

Kapil Tiwari (Querist)

20 February 2013 A business person states that he is investing 1 lakh each in 3 PPF accounts. The accounts are in his name, his spouse's name and in the name of 1 major son. Hence, he invests 3 lakhs total per annum! He invest from his account and is not claiming any Income Tax benefit (except from the one lakh that he invests in his own name). Hence, for the balance 2 lakhs that he invests in the name of his spouse and major son, he does not claim any income tax benefit. He is doing it to get a tax free retirement income for himself and to give a decent amount to his grand children. Is it permitted officially?

I am aware that 1 lakh is the maximum investment per year allowed in one's own account plus his minor child's account. But I was not aware that one could invest additional one lakh each in a major son's account and spouse's account. So, if this person had a spouse and 3 major children, he could invest upto 4 lakhs per year and he could amass a huge tax-free retirement corpus!!

@VaibhavJ

@VaibhavJ (Expert)

20 February 2013 Hi

He in any case he will be entitle to claim max Rs. 1 lac tax exemption.

So far he is depositing money on behalf of minor child, it is allowed & for major child & spouse contribution is not allowed.

Thanks!!

Message likes : 2 times

Kapil Tiwari

Kapil Tiwari (Querist)

20 February 2013 Well noted your point, Vaibhav. Thanks.

@VaibhavJ

@VaibhavJ (Expert)

21 February 2013 Thanks for feedback..

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now