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PPF interest

Rohit Tulshyan (RTProfessionals) (333 Points)

16 May 2011

Is an assesse eligible for ppf interest deduction u/s 80c for an amt over and above rs. 70,000 after a deposit of rs. 70,000.

I.e. if ppf interest is 20,000 and amt invested is rs. 70000 in that year than total deduction should be 20,000 + 70,000=90,000 or only 70,000(as restricted).

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13 Replies

Balaji (Knowledge Seeker) (317 Points)
Replied 16 May 2011

Only contribution to PPF A/c (subject to a maximum of Rs.70,000/- p.a.) is eligible for deduction u/s 80-C.Interest earned on PPF balance is tax-exempt but does not enjoy rebate u/s 80-C.

2 Like

Deepak Gupta (CA Student) (15922 Points)
Replied 16 May 2011

Originally posted by : Balaji
	Only contribution to PPF A/c (subject to a maximum of Rs.70,000/- p.a.) is eligible for deduction u/s 80-C.Interest earned on PPF balance is tax-exempt but does not enjoy rebate u/s 80-C.

In addition to answer by Mr. Balaji
.
PPF Interest is Exempt u/s 10(11)

1 Like

U S Sharma (glidor@gmail.com) (21056 Points)
Replied 16 May 2011

as PPF interest is exempted u/s 10(11),

exempted amunt does not participate under 80C, as 80C is available for investment from TAXABLE income only.

1 Like

Sagar Zankhariya (Audit Assist.) (278 Points)
Replied 17 May 2011

PPF investment maximum deduction allowed only Rs. 70,000/- & interest is received or accrued is exemted.

Arniv Sharda (CA Final) (3006 Points)
Replied 17 May 2011

Originally posted by : U S Sharma
	as PPF interest is exempted u/s 10(11), exempted amunt does not participate under 80C, as 80C is available for investment from TAXABLE income only.

agreed

cheers

KIYOSH (TAX CONSULTANT) (332 Points)
Replied 17 May 2011

amount deposited in PPF a/c is exempt & that is maximum Rs. 70,000/- only. Int recd on it should not consider under deduction 80C.

Kumar Babu.G (Chartered Accountant) (1597 Points)
Replied 17 May 2011

I agree with Mr.Balaji.

Anila (Article Assistant) (177 Points)
Replied 17 May 2011

Interest on PPF- consider as income in first instance

then claim exemption of the same!!

it is not a deduction in Total income rather an exempt income!

sandeepverma (don't make exuse for study) (304 Points)
Replied 17 May 2011

only PPF contribution

pavankumarcma (B.Com ICWAI (CA FINAL) SAP Consultant) (147 Points)
Replied 17 May 2011

Amount of contribution to PPF of Rs.70,000 eligible for deduction U/S 80 C.

Interest earned on PPF amount will be exempted U/S 10(11).

Rohit Tulshyan (RTProfessionals) (333 Points)
Replied 17 May 2011

I agree that its exempted. I want to knownis it allowed suppose their is deposit of rs. 70,000 and over it i get a interest of rs 20,000 that can i claim deduction of rs 90,000 or rs. 70,000.

U S Sharma (glidor@gmail.com) (21056 Points)
Replied 17 May 2011

80C is deduction from taxable income, so the exempted incomes can not participate in 80C

CA ADITYA SHARMA (CA IN PRACTICE ) (16719 Points)
Replied 18 May 2011

Originally posted by : Balaji
	Only contribution to PPF A/c (subject to a maximum of Rs.70,000/- p.a.) is eligible for deduction u/s 80-C.Interest earned on PPF balance is tax-exempt but does not enjoy rebate u/s 80-C.