Question: do we need to pay tax on ppf interest

Answer: No, The minimum amount is Rs.500 which can be deposited. The rate of interest at present is 7.6% per annum, which is also tax-free. The entire balance can be withdrawn on maturity. Interest received is tax free. The maximum amount which can be deposited every year is Rs. 1,50,000 in an account at present. The interest earned on the PPF subscription is compounded annually. All the balance that accumulates over time is exempted from wealth tax. Moreover, it has low risk -- risk attached is Government risk. PPF is available at post offices and banks.