Is PPF Tax-Saving a Myth? The 3% Difference That Busts the 30% Tax Myth! 📉💡
The PPF (Public Provident Fund) is often praised for its tax-saving benefits and safe returns. But is it truly the best option? Here’s an interesting analysis: 📊 Scenario 1: Investing in PPF Annual Investment: ₹1.5 lakhs Interest Rate: 7.15% p.a (compounded annually) Duration: 15 years Maturity Amount: ₹4,22,643 {(1.0715^15) *1,50,000} Tax Deduction: Utilizes the full ₹1.5 lakh 80C deduction, saving ₹45,000 in taxes annually. Taxation: Maturity amount is non-taxable 💹 Scenario 2: Alternative Investment Post-Tax Initial Investment Post-Tax: ₹1.05 lakhs (after 30% tax on ₹1.5 lakhs) Interest Rate: 10.15%p.a (compounded annually) Duration: 15 years Maturity Amount(Pre-tax): ₹4,47,669 {(1.1015^15) *1,05,000} Taxation: 10% tax on profits above ₹1 lakh at maturity Maturity Amount (Post Tax):- 4,23,402 [{4,47,669-1,05,000(Investment)-1,00,000(Exempt)}*10%] Additional 80C Deduction: Save ₹45,000 in taxes, which can be invested a...