What happens to your PPF when you die — and how your family claims it

PPF is one of the cleanest tools in the Indian saver's kit — fixed 7.1% (currently), tax-free interest, EEE status, sovereign guarantee. It is also one of the messiest things to inherit if you didn't plan for it. Here's exactly what happens when a PPF account holder dies, what your family has to do, and the three decisions you can make now that save them weeks of work.

**The first rule: the 15-year lock-in does not apply on death.** This is the most misunderstood point. A PPF account normally matures 15 years from the end of the financial year in which it was opened. If the account holder dies before maturity, the lock-in dissolves immediately. The nominee or legal heir can claim the entire balance — principal plus interest accrued up to the end of the month preceding the death (not the date of death; the rule is end of the preceding month, per the PPF Scheme 2019) — in a single payment. No partial-withdrawal waiting period applies.

**The second rule: the account cannot be continued by the nominee or legal heir.** Unlike PPF maturity-time extension (where the holder can extend in 5-year blocks), there is no continuation on death. The balance is paid out. If your spouse already has their own PPF account, they can deposit a portion into their own (within the annual ₹1.5 lakh limit), but they cannot 'take over' yours. The account is closed.

**Nominee vs legal heir — same trap as elsewhere.** A PPF nominee receives the money in trust for the legal heirs. If you nominated your brother and your will leaves everything to your daughter, the brother receives the funds and is legally bound to hand them to the daughter. In practice families don't litigate this often because PPF balances aren't usually large enough to justify a court case — but if you have a ₹40 lakh PPF balance (a lifetime maxed-out account would be in this range) and a contested will, you have a real problem. The fix: align your PPF nominee with the heir named in your will, and tell both your nominee and your heirs who gets what.

**The form your family files: Form G (with nominee) or Form H (legal heir certificate route).** If you registered a nominee on Form F: your nominee files **Form G** at the branch where your PPF account is held (or at the post office for postal PPF) along with your death certificate, their identity proof, your PPF passbook, and a cancelled cheque from the nominee's bank account. Processing is usually 7-15 working days. If no nominee, or the nominee has predeceased you: your legal heir files **Form H** along with a succession certificate, legal heir certificate from the tehsildar, or a probated will. This route can take 6 weeks to 6 months depending on the supporting documentation.

**Balances above ₹1 lakh without nomination = succession certificate required.** If your PPF balance exceeds ₹1 lakh and there's no nominee, banks/post offices will not pay against an indemnity bond alone — they will require a succession certificate from the civil court. Succession certificates take 4-9 months in most Indian cities and cost ₹5,000-25,000 depending on the lawyer. This alone is a reason to nominate.

**Three decisions to make right now.** (1) Nominate, if you haven't. PPF Form F, at your bank or the post office. Free, ten minutes. (2) Update your nominee after any major life event — marriage, child, divorce, death in family. (3) Tell your nominee, by name, that they are the PPF nominee, what the account number is, and at which branch — so they can act in the first week, not the third month. Sort My Legacy's Financial Inventory lets you record the PPF account, the nominee, and the branch in one place; your family sees it the moment they have access.

**One advanced note: tax-free status survives death.** The amount your family receives is tax-free in their hands (PPF returns are EEE — exempt at investment, accrual, and withdrawal). It is not added to their income. They should still mention it in their ITR's exempt income section in the year of receipt to keep their paper trail clean, but no tax is payable.