{"id":52382,"date":"2023-02-14T14:01:33","date_gmt":"2023-02-14T08:31:33","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=52382"},"modified":"2023-02-14T14:01:34","modified_gmt":"2023-02-14T08:31:34","slug":"difference-between-epf-and-ppf-account","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/difference-between-epf-and-ppf-account\/","title":{"rendered":"EPF And PPF: Difference, Comparison, Returns &#038; Which Is Better?"},"content":{"rendered":"\n<p>Employee Provident Fund\n(EPF) and Public Provident Fund (PPF) are two of the most popular savings\nschemes in India. Both of these schemes have been designed to help people save\nmoney for their future. They are widely popular due to their tax-saving benefits,\nlong-term investment options, and guaranteed returns. However, there are many\ndifferences between EPF and PPF, and it can be confusing to determine which one\nis better. In this blog, we will discuss the key differences, comparisons,\nreturns, and which one is better between EPF and PPF.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Page Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/corpbiz.io\/learning\/difference-between-epf-and-ppf-account\/#What_is_Employee_Provident_Fund_EPF\" >What is Employee Provident Fund (EPF)?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/corpbiz.io\/learning\/difference-between-epf-and-ppf-account\/#What_is_Public_Provident_Fund_PPF\" >What is Public Provident Fund (PPF)?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/corpbiz.io\/learning\/difference-between-epf-and-ppf-account\/#Comparison_between_EPF_and_PPF\" >Comparison between EPF and PPF<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/corpbiz.io\/learning\/difference-between-epf-and-ppf-account\/#Which_Is_Better_EPF_or_PPF\" >Which Is Better: EPF or PPF?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/corpbiz.io\/learning\/difference-between-epf-and-ppf-account\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_Employee_Provident_Fund_EPF\"><\/span>What is Employee Provident Fund (EPF)?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The <strong><a class=\"text-primary\" href=\"https:\/\/corpbiz.io\/epf-registration\">Employee Provident Fund<\/a><\/strong> (EPF) is a\nretirement savings scheme that is mandatory for all employees in India who are\nearning more than Rs 15,000 per month. Under this scheme, both the employee and\nthe employer make equal contributions towards the fund every month. The\ncontribution is 12% of the employee&#8217;s basic salary, out of which 8.33% is\ninvested in the EPF account, and the remaining 3.67% goes towards the\nEmployee&#8217;s Pension Scheme (EPS). The EPF is managed by the Employees&#8217; Provident\nFund Organization (EPFO) and the funds are invested in government bonds and\nother approved securities.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_Public_Provident_Fund_PPF\"><\/span>What is Public Provident Fund (PPF)?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The Public Provident Fund\n(PPF) is a government-backed savings scheme that is open to all citizens of\nIndia, including salaried individuals, self-employed individuals, and\nhousewives. It is a long-term investment option that offers tax benefits and\nguaranteed returns. Under this scheme, individuals can make a minimum\ncontribution of Rs 500 and a maximum of Rs 1.5 lakh per financial year. The\nfunds are invested in government securities and the returns are tax-free. The\ntenure of a PPF account is 15 years, and it can be extended in blocks of 5\nyears.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Comparison_between_EPF_and_PPF\"><\/span>Comparison between EPF and PPF<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The following is a\ncomparison between EPF and PPF:<\/p>\n\n\n\n<ul><li><strong>Eligibility:<\/strong>\nEPF is mandatory for salaried employees, while PPF is open to all citizens of\nIndia. <\/li><li><strong>Contribution:<\/strong>\nThe contribution towards EPF is made by both the employee and the employer, while\nthe contribution towards PPF is made solely by the individual.<\/li><li><strong>Tax Benefits:<\/strong>\nBoth EPF and PPF offer tax benefits, but the tax exemptions on PPF\ncontributions are higher compared to EPF contributions. Under Section 80C of\nthe Income Tax Act, contributions to EPF are eligible for tax exemptions up to\na maximum of Rs 1.5 lakh per financial year. On the other hand, contributions\nto PPF are eligible for tax exemptions under Section 80C, and the interest\nearned on the PPF balance is exempt from tax under Section 10(11).<\/li><li><strong>Investment Options:<\/strong>\nEPF funds are invested in government bonds and other approved securities, while\nPPF funds are invested solely in government securities. EPF offers a lower\ndegree of risk as the funds are invested in government bonds, but the returns\nare also lower compared to other investment options. PPF, on the other hand,\noffers a higher degree of safety as the funds are invested in government\nsecurities, but the returns are also lower compared to other investment\noptions.<\/li><li><strong>Returns:<\/strong>\nThe returns on EPF are fixed at 8.5% per annum, while the returns on PPF vary\nbased on the performance of the government securities in which the funds are\ninvested. However, the returns on PPF are usually in the range of 7% to 8% per\nannum.<\/li><li><strong>Tenure:<\/strong>\nThe tenure of EPF is till the employee retires, while the tenure of PPF is 15\nyears, which can be extended in blocks of 5 years. EPF provides a long-term\nsavings option for employees, while PPF provides a medium-term savings option\nfor individuals.<\/li><li><strong>Withdrawal:<\/strong>\nThe withdrawal from EPF is allowed only after the employee retires or resigns,\nwhile the withdrawal from PPF is allowed after the completion of 15 years or on\nthe death of the account holder. EPF provides a comprehensive retirement\nsolution, while PPF provides a savings option for medium-term financial goals.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Which_Is_Better_EPF_or_PPF\"><\/span>Which Is Better: EPF or PPF?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The choice between EPF\nand PPF depends on the individual&#8217;s financial goals, tax liabilities, and risk\ntolerance.<\/p>\n\n\n\n<p>For salaried employees,\nEPF is a mandatory savings option and it provides a comprehensive retirement\nsolution. The contribution towards EPF is made by both the employee and the\nemployer, which makes it a convenient option for employees to save for their\nfuture.<\/p>\n\n\n\n<p>For individuals who are\nlooking for a medium-term savings option with tax benefits, PPF is a good\noption. PPF offers tax exemptions on contributions and tax-free returns, which\nmakes it a tax-efficient savings option. Additionally, PPF provides a higher\ndegree of safety as the funds are invested in government securities.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>In conclusion, EPF and <strong>PPF<\/strong><sup><a class=\"text-primary\" href=\"http:\/\/www.nsiindia.gov.in\/\"><strong>[1]<\/strong><\/a><\/sup> are\ntwo of the most popular long-term and medium-term savings options in India. EPF\nis a mandatory savings option for salaried employees and provides a\ncomprehensive retirement solution, while PPF is a good option for individuals\nlooking for a tax-efficient medium-term savings option.<\/p>\n\n\n\n<p>EPF offers a lower degree\nof risk as the funds are invested in government bonds, but the returns are also\nlower compared to other investment options. PPF, on the other hand, offers a higher\ndegree of safety as the funds are invested in government securities, but the\nreturns are also lower compared to other investment options.<\/p>\n\n\n\n<p>Both EPF and PPF offer\ntax benefits, but the tax exemptions on PPF contributions are higher compared\nto EPF contributions. The choice between EPF and PPF depends on the\nindividual&#8217;s financial goals, tax liabilities, and risk tolerance.<\/p>\n\n\n\n<p>It is important to\nremember that both EPF and PPF should be considered as long-term savings\noptions and should not be considered as a source of quick funds. Individuals\nshould consult with a financial advisor before making a decision on which\nsavings option to choose.<\/p>\n\n\n\n<p>In conclusion, both EPF and PPF are good savings options with their own set of benefits and drawbacks. Individuals should consider their financial goals, tax liabilities, and risk tolerance before making a decision on which savings option to choose.<\/p>\n\n\n\n<p class=\"text-left\"><b>Read Our Article<\/b>: <mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/major-difference-between-esi-and-epf-registration\/\">What Is The Difference Between ESI And EPF Registration?<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Employee Provident Fund (EPF) and Public Provident Fund (PPF) are two of the most popular savings schemes in India. Both of these schemes have been designed to help people save money for their future. They are widely popular due to their tax-saving benefits, long-term investment options, and guaranteed returns. However, there are many differences between [&hellip;]<\/p>\n","protected":false},"author":54,"featured_media":52388,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[164],"tags":[3079],"acf":{"service_id":"15"},"authorName":"Shivam Narwal","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2023\/02\/MicrosoftTeams-image-65.jpg","authorDescription":"Shivam Narwal, a motivated final year BBA LLB law student at Chandigarh University, has started his legal career at Enterslice as a legal researcher. With a strong focus on thorough and accurate research, Shivam is dedicated to delivering exceptional results. Throughout his studies, he has shown a deep understanding of the legal system and a drive to excel in the field of Law.\u00a0","postViews":1883,"readingTime":4,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/52382"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/54"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=52382"}],"version-history":[{"count":2,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/52382\/revisions"}],"predecessor-version":[{"id":52389,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/52382\/revisions\/52389"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/52388"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=52382"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=52382"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=52382"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}