New Tax Regime PPF and SSY: Many people who picked the new tax regime for FY 2025-26 may think there is no big reason to keep putting money in Public Provident Fund or Sukanya Samriddhi Yojana. This is because the old tax regime gives a deduction of up to Rs 1.5 lakh under Section 80C, while the new tax regime does not give that same benefit.
The new tax regime has become more attractive for many taxpayers after the government said there will be no income tax on annual income up to Rs 12 lakh, and up to Rs 12.75 lakh for salaried people after the standard deduction. But even with that change, PPF and SSY still matter a lot. That is because the interest earned in these schemes and the money received on maturity remain tax-free.
So even if a person chooses the new tax regime, these two schemes still give a safe long-term way to grow money without tax on the final return. The official NSI and India Post rules continue to show PPF at 7.1% and SSY at 8.2%, while SSY interest remains exempt from income tax.
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That is why many savers still keep these accounts active and continue investing up to the allowed limit. PPF may not give a tax deduction under the new regime, but it still gives tax-free interest and tax-free maturity value.
The same logic works for SSY too. That is why continuing these accounts can still make sense for long-term saving. In the case of SSY, the tax benefit structure is still strongly protected, which is why the answer is “no” if someone asks whether the interest is taxable. This investment falls under the ‘Exempt-Exempt-Exempt’ (EEE) category.
PPF before April 5
There is also one small timing rule that can make a real difference in PPF. The rule says interest is calculated on the lowest balance in the account between the close of the 5th day and the end of the month. This means if you put money into the account on or before April 5, that amount gets counted for interest in April itself.
So if someone wants to invest the full year’s PPF amount in one go, doing it by April 5 is usually the better move because the money can then earn interest for all 12 months of that financial year. The same logic applies to monthly deposits too. If the money is deposited on or before the 5th of each month, the saver gets the best chance to earn the highest possible interest for that month.
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SSY Under the New Regime
Sukanya Samriddhi Yojana continues to be a strong savings option for families with a daughter below the age of 10. Parents or guardians can open the account and put money into it for the child’s future. The scheme earns interest like a long-term small savings product and helps build a fund that can later support education or other major life goals.
