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If you have a <keyword id="19930665" type="General" weightage="100" keywordseo="PPF" source="keywords">PPF</keyword> account, you might want to pay attention to this! Starting October 1st, 2024, your PPF account is set to undergo massive changes, thanks to the new regulations, which were notified by the government in August this year, taking effect. If you don't know about them, here's a ready reckoner for you to get up to speed. 1. If you have opened a PPF account in your child's name i.e. a minor (who's under 18 years of age), their account would earn interest equivalent to a POSA (<keyword id="20076819" type="General" weightage="20" keywordseo="post-office-savings-account" source="keywords">Post Office Savings Account</keyword>), which currently stands at 4% p.a. Once your child turns 18 and attains majority, the standard PPF <keyword id="20071327" type="General" weightage="20" keywordseo="interest-rate" source="keywords">interest rate</keyword>, which is presently at 7.1%, will kick in. Remember that in a post office savings account, no interest is credited for a particular month, if the balance in this account falls below Rs 500, between the tenth and last day of the month. The maturity period for all such accounts will be calculated from the day the child turns 18 i.e. attains majority. Normally, the general maturity period of a PPF account is 15 years, with the possibility of extending it multiple times, but only in blocks of 5 years. 2. Have multiple PPF accounts? Well, you will not be earning any interest on any of your other PPF accounts, except for your primary one. As it is, PPF rules mandate that an individual can only have 1 PPF account. Inadvertently, many people end up opening 2 PPF accounts, sometimes with different banks, or one with a bank and post office each. Also, note that if you have opened a second PPF account on or after December 12, 2019, you are not eligible for merger of both your PPF accounts. In this case, your second account would be closed, without bearing you any interest. But if you have opened a second PPF account before this date, you can request for merger. However, in case you have not requested for such a merger, only your primary PPF account will continue earning interest at the rate of 7.1% p.a. While you will be able to transfer and send funds across from your second account, interest will only accrue on your primary PPF account, so better regularize your PPF account in the next 4 days with the post office or agency bank, lest you lose out on interest income. In case the balance in your primary PPF account is below the maximum annual investment limit of Rs 1,50,000, any balances you have in your second account will be added to the same, in order to calculate interest. And thereafter, any remaining balances in your second PPF account will be rendered ineligible for further interest. Lets understand this with an example. Suppose you hold 2 PPF accounts-A and B. The balance in account A is Rs 1,00,000, and that of B is Rs 70,000. In this case, you will only earn interest on Rs 50,000 from account B, while the remaining Rs 20,000 will not be considered while calculating interest. If the primary account stays below the applicable investment limit each year, the balance in the second account will be added to it. The primary account will continue to earn the prevailing scheme rate of interest after the merger. The second account's i.e. B excess balance will be returned without interest. 3. If you are an NRI who currently holds an active PPF account, where your residency status in Form H, which is needed to extend the tenure of your PPF account by 5 years was not asked for, your account will continue to earn interest at the same rate as a POSA (4%). Starting October 1st, such accounts will accrue no interest at all. Notably, while NRIs cannot open new PPF accounts, they can continue investing in their existing PPF account, which they had opened whilst they were still Indian resident. But once their account matures i.e. 15 years are over, they will not be able to extend their account's tenure.

Attention! Here's what's changing with your PPF accounts starting 1st October, 2024

<ul><li>STT increased on futures and options trading </li><li>Changes in <keyword id="22258595" type="General" weightage="20" keywordseo="TDS-rates" source="keywords">TDS rates</keyword> (from 5% to 2%) on payments for life insurance policy, brokerage </li><li>Buybacks to be treated as dividends for taxation purposes</li><li>Small savings account rates left unchanged for Oct-Dec 2024</li></ul>Starting October 1st, a lot is set to change with your money. From <keyword id="20852321" type="General" weightage="100" keywordseo="FO-trading" source="keywords">F&amp;O trading</keyword> (futures and options) and buybacks getting more expensive in the hands of the individual, to changes in TDS slabs for payments concerning life insurance, brokerage, and more, here's a ready reckoner for all that you need to know: 1. STT upped for F&amp;O (Futures and Options) trading This budget, in a bid to discourage retail investors from burning their hands in the highly risky F&amp;O segment, the government had proposed raising the STT (securities transaction tax) for both futures and options. Starting today, you will have to pay an STT of 0.1% on premium earned from option sales, as opposed to 0.0625% previously. As for futures, the STT is set to rise to 0.02% of trade price, up from its previous mark of 0.0125%. Notably, STT is levied every time an individual purchases or sells a security, which significantly increases its incidence and coverage. For instance, if the trading price of the futures you're selling today is Rs 1,000, you'd have to pay Rs 0.2 as STT today. Till September 30th, the STT applicable would be Rs 0.12. Similarly, for options, if the settlement price of your options contract is Rs 1,000, your STT payable today would be Re 1, which earlier stood at Rs 0.625 While this may sound super inconvenient for frequent or intraday traders, a recent SEBI study has highlighted that a staggering 93% individual traders have incurred just losses while trading in the F&amp;O segment between FY22 and FY24, with the total losses exceeding Rs 1.8 lakh crore during this period. Only a tiny 1% traders managed to rake in profits above Rs 1,00,000. Perhaps SEBI is thinking along the lines of prevention being better than cure? 2. Changes in Debit card rules for ICICI bank ICICI debit card users, who also happen to be frequent flyers, listen up! Starting today, you will be able to access the complimentary airport lounge service twice, but only if you have spent Rs 10,000 or more via your card in the previous quarter. So, suppose you've spent just Rs 8,000 between July-September 2024 via your ICICI debit card. Since this falls below the Rs 10,000-threshold, you wont be able to access complimentary airport lounge service two times between October-December 2024. 3. Changes in rules for PPF, small savings account The interest rates on various small savings schemes were left unchanged by the Finance Ministry for the upcoming quarter i.e. October-December 2024. For this quarter, Public Provident Funds (PPF) will earn you 7.1% interest p.a., while Sukanya Samriddhi Yojana (SSY) and Senior Citizens Savings Scheme (SCSS) will offer interest at the rate of 8.2% p.a. <div type="Article" hostid="261" msid="113692667" title="Attention! Here's what's changing with your PPF accounts starting 1st October, 2024" mstype="2" mssubtype="0"></div> Also, these changes in PPF accounts will kick in from today: <ul><li>Have a PPF account in your child's name i.e. a minor? This account would earn the same interest as a POSA (Post Office Savings Account) i.e. at 4% p.a. currently. Once your child turns 18, the prevailing PPF interest rate, which is presently at 7.1%, will be levied. </li><li>No more interest earning via multiple PPF accounts! Starting today, only your primary PPF account will be eligible for interest. </li><li>Are you an NRI who currently holds an active PPF account, and you have not disclosed your residency status in Form H (used to extend the tenure of your PPF account by blocks of 5 years)? Starting today, such accounts will earn zero interest. </li></ul>4. Buyback set to get more expensive Buybacks happen when a company decides to buy back its own shares from its existing shareholders. What's in for the shareholders, you ask? The buyback price is usually higher than what is offered by the markets. You are eligible to participate in a company's buyback if you hold its shares on or before the record date that's set by the company. Starting today, buybacks will be treated just like dividends. This means starting today, the burden of tax payable on buybacks will fall on the shareholders selling the shares, and not the company. Buybacks will be taxed as per the individual's personal income tax bracket. 5. Revision of TDS rates Starting today, the TDS (tax deducted at source) on various payments you make for life insurance, lottery tickets and more is also set to change. Here's how TDS rates will look, starting today: <table class="redcator-table-advance"><tbody><tr><td>Category </td><td>Previous TDS rate</td><td>New TDS rate (Effective October 1st, 2024)</td></tr><tr><td>Payment made towards life insurance policies</td><td>5%</td><td>2%</td></tr><tr><td>Commission earned on sale of lottery tickets </td><td>5%</td><td>2%</td></tr><tr><td>Payment of commission/ brokerage </td><td>5%</td><td>2%</td></tr><tr><td>Payment of rent by certain individuals/HUF </td><td>5%</td><td>2%</td></tr><tr><td>Payment made by e-commerce operators/platforms to e-commerce participants/sellers </td><td>1%</td><td>0.1%</td></tr></tbody><tbody></tbody><tbody></tbody></table>

Attention! Here's what's changing with your PPF, F&O trading, and buybacks, starting today!

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Attention! Here's what's changing with your PPF accounts starting 1st October, 2024

Ira Alok Puranik

Attention! Here's what's changing with your PPF, F&O trading, and buybacks, starting today!

Ira Alok Puranik

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