Documents required for opening an account

The next important thing to keep in mind is the documents required.  This includes KYC documents, a passport size photograph along with the proof of age of the minor child—a birth certificate or a school certificate is required to be submitted along with the account opening form.

Investment limit in a PPF account for a minor

Investment is one complicated part. According to the new regulations the current regulations, for an individual, the upper limit is of 1 Lac per financial year for deposits in a PPF account. There is a wrong conception among the parents that since they have a PPF account in their name and a PPF account in their child’s name, they can deposit 1 Lac each (total of 2 Lacs) in these accounts in a Financial Year and can get tax benefit on that.

But the truth is that as per the regulations an Individual cannot have more than 1 Lac in a PPF account. Hence, even if you have an account in your own name as an Adult investor as well as one in the Minor’s name wherein you are the guardian, still you can only deposit a maximum of 1 Lac combined in these two accounts.

Tax exemption: The maximum of tax exemption is 1 lakh under section 80C for a guardian. This limit is applicable on the balances in both the PPF accounts.