Deposit Minimum Amount in PPF, NPS and Sukanya Accounts; Otherwise the Account will be Closed

If you have a Public Provident Fund (PPF), National Pension Scheme (NPS), or Sukanya Samriddhi Yojana (SSY) account, you should be aware of this information. If you haven’t yet put money in any of these accounts this financial year, do so right away. Your account will be deactivated if you do not do so. After the account has been dormant for a period of time, a penalty must be paid to reactivate it.

For your information, you have the option of choosing between two income tax regimes. The Old Tax Regime and the New Tax Regime are the two. The greatest tax exemption and deduction on income is provided under the new income tax regime. If you’ve chosen the new income tax regime, you’ll need to make a minimum deposit to keep your PPF, NPS, and SSY accounts alive.

What is the minimum amount in a PPF account?

In a financial year, the minimum annual contribution to a PPF account is Rs.500. For the current financial year, the deadline to make this contribution is March 31, 2022.

What happens if you don’t make the required deposit?

If you do not deposit the required amount by the 31st of March, you will be charged a penalty of Rs.50 per year. You would have to pay an additional Rs.50 per year in addition to the Rs.500 minimum deposit. If you do not pay the money for two years, you will be required to pay a fee of Rs.500 + 500 for two years, as well as Rs.50 + 50 for two years in the third year.

Your PPF Account will be Terminated

In addition, if the minimum contribution is not made within the financial year, the PPF account will be closed. A closed PPF account will not be able to take out a loan or make a partial withdrawal until it is restored. A closed account can be reopened before its original maturity date expires. It cannot be engaged once it has reached maturity. It also cannot be closed before reaching maturity.

Minimum Amount in NPS

According to the current criteria, Tier-I NPS account holders must contribute a minimum of Rs.1,000 in a financial year to keep the account operational.

The NPS Tier-I account will become inactive if the minimum contribution is not made. To reactivate an inactive NPS account, you must pay a Rs.100 penalty each year, as well as a minimum contribution. Unfreezing the NPS account will also incur Point of Presence (POP) expenses.

If a person also has a Tier-II NPS account (which does not require a lock-in period), the Tier-II account will be frozen along with the Tier-I account. However, there is no minimum contribution requirement in Tier II NPS accounts.

Sukanya Samriddhi Account Scheme

To keep the Sukanya Samriddhi account operational, a minimum contribution of Rs.250 is required each financial year. If the minimum amount is not deposited in any financial year, the account is considered defaulted.

A defaulted account can be restored before 15 years have passed from the date the SSY account was opened. To activate the account, you must make a minimum payment of Rs.250 and pay a penalty of Rs.50 for each default year.