PPF Account For NRI

Non-Resident Indians (NRIs) are not eligible to open an account under The Public Provident Fund Scheme, 1968. However, NRIs, who had invested in the PPF before becoming a non-resident during the maturity period of the account, can continue to subscribe to the Fund till its maturity on a non-repatriation basis. Non-Repatriation basis means funds in such accounts cannot be transferred back to the NRI’s country of residence or converted to any foreign currency.

PPF subscribers, who become NRI before the maturity of the account, can continue to subscribe to the Fund till the completion of maturity period. PPF account matures after the completion of 15 full financial years from the end of the year in which the account was opened.

Within one month of change of citizenship or resident status, the PPF subscriber should intimate the bank or post office (whichever is applicable).

Investment in Existing PPF Account After Becoming an NRI

The government has permitted the investment into the PPF account till the maturity. After the account matures, an NRI is not permitted to deposit fresh contributions. “If a resident, who subsequently becomes Non-Resident Indian during the currency of the maturity period prescribed under Public Provident Fund Scheme, may continue to subscribe to the Fund till its maturity on a Non-Repatriation Basis.”

PPF Withdrawal or Account Closure by NRI

An NRI has to follow the same procedure for the PPF withdrawal. There is no relaxation or limitation to them. The form and process are the same. You can get the PPF corpus in your NRO account. In India, there would not be any tax on this amount. However, your country of residence can charge tax on this.

To withdraw PPF corpus after maturity, you have to visit the base branch of your PPF account. Submit PPF withdrawal form along with your passbook. You must give the account number of your NRO account so that money gets credited into it. You can see the image of the PPF withdrawal Form.

Limitations of PPF Account For NRI

The PPF account is not the same for NRI. The rules are different for them. There are some limitations.

• Non-Resident Indian can’t keep on investing in PPF accounts after maturity. The NRI can keep a PPF account without the new contribution. While common Indian residents can extend PPF accounts with the new contribution.
• An NRI has to contribute into the PPF account through the NRE, NRO or FCNR Account.
• Like an ordinary Indian Resident, an NRI can also withdraw a partial amount from the PPF account. But the amount can’t be repatriated abroad. The NRI has to spend this amount only in India. However, the NRI can repatriate the maturity proceeds via the NRO account. The RBI permits repatriation overseas under the Liberalized Remittance Scheme (LRS).

Steps to Close PPF account [For NRI]

For an NRI to close a PPF account, he or she must visit the bank branch in India. At the branch, they need to submit the PPF withdrawal form, ID proof copy, passbook and cancelled cheque. Hence, if they are visiting India, they can go directly to the bank and complete the formalities. The money would go to the individual’s NRO Account.

However, if they can’t come back to India, their representative can visit the branch. For that, they have to give the authorization letter to the representative. Steps are as follows.

• Download the PPF withdrawal form and fill it.
• Attach the ID proof, Address proof and cancelled cheque of your NRO account.
• Write an authorization letter stating that your representative would visit the bank to submit the form as you are unable to come there.
• Send all these documents to your representative in India.
• Your representative has to visit the bank where you have the NRO account. He has to get your documents attested by the bank manager.
• The representative would visit the bank branch for PPF withdrawal and submit all the documents.
• The bank processes the application and money would be credited to your NRO Account.

About PPF Account for NRI

The Public Provident Fund is a savings-cum-tax-saving instrument to mobilize small savings by offering an investment with reasonable returns combined with income tax benefits. The scheme is fully guaranteed by the Government of India. Balance in PPF account is not subject to attachment under any order or decree of the court. However, Income Tax & other Government authorities can attach the account for recovering tax dues.

Non-resident Indians are not permitted to open or operate a PPF account in India. It is, however, if a person opens a PPF account as an Indian citizen and later becomes an NRI then the account will remain active.

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