Should investment in PPF in a financial year be out of the income received in that year or can it be out of one's previuos years' savings, to get the benefit of section 80C?
Ramachandran Ravoori (Individual) (29 Points)
22 April 2012Should investment in PPF in a financial year be out of the income received in that year or can it be out of one's previuos years' savings, to get the benefit of section 80C?
CA Darshak Shah
(Practicing CA)
(1889 Points)
Replied 22 April 2012
As per my opinion...
It can be invested from even last years savings as well...
You must be able to justify source of money..it can be of any year....
Rammohan
(NA)
(255 Points)
Replied 28 April 2012
Some years ago, it used to be the case that the investment in PPF should be from the income subject to tax in the same FY. However, since the past 4 or 5 years, this provision has been withdrawn. Hence, there is no bar to an investment in PPF from earlier years' savings. However, please avoid depositing cash in PPF a/c and also ensure that the account from which you would issue a cheque for PPF deposit has been reported in your income-tax returns of the earlier years.
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