PPF account can be extended in block of 5 years

SC  Vasudeva

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I have a PPF account and it will mature on September 30, 2016 after completing a term of 15 years. Is it possible for me to continue with the account for some more years? — rajiv puri

According to a clarification issued by the Office of the Regional Director, National Savings Institute vide its letter No.1266/PPF/NSI-CHD/07 dated June 18th, 2007, the PPF account can be extended for any number of block of five years without any limit. Therefore, in case you so desire, you can extend the PPF account for another five years without any difficulty. You can exercise this option by filing Form H and submitting the same to the bank in which you have your account. 

I retired in February 2016 from a Central PSU. I am getting self-contributed pension of Rs 15,000 (approx) through LIC invested by my company.  At the time of retirement, I got Rs 80 lakh as retirement benefits. I do not have nay any other monthly income. My wife is not working. I have made the following investments to date:

• Invested Rs 15 lakh in a bank senior citizen scheme in the last financial year and Rs 15 lakh in this financial year.  I am getting Rs 30,000 quarterly. 
• Invested Rs 4.5 lakh each in self and spouse name in Post Office MIS Scheme. I am getting Rs 6,300 per month from that scheme.
• I have invested the balance Rs 40 lakh (approximately) in bank FDs for one year — Rs 20 lakh each in self and spouse name. Please advise on the following points:

a) Long-term investment option with 

monthly income.

b) Procedure to gift the amount to spouse. I understand that the amount gifted to spouse will be accounted for tax in her account.

c) Any other safe investment option to save tax.

— ts kamboj

Your queries are replied hereunder:

a) Please consult an investment adviser who would be able to guide you much better on this issue.

b) Any income arising from the amount gifted to your wife would be included as part of your income. You have been incorrectly advised that the amount gifted to spouse will be treated as her own. This advice is not in accordance with the provisions of Section 64 of the Income-tax Act 1961 (The Act).  This section provides that any income arising from an asset transferred to spouse without any consideration shall be included in the income of the individual who has transferred such an asset.

c) Investment in debt mutual funds and tax-free bonds should be safe investment. Income-tax chargeable on the sale of debt instruments is also lower if these are kept for three years or more.

I am a senior citizen and retired from State Bank of India. Due to cardiac disease, I had to undergo angiography (CAG), PTCA and two stents were placed to my LCX & LAD in July, 2015. For this treatment, I paid Rs 2,56,000 on a package basis to the hospital in cash. Later, this amount was reimbursed to me by the bank under a contributory scheme —SBI Retired Employees Medical Benefit Scheme. Now I am following up for my treatment and it will continue in future, perhaps for the whole life. I am spending around Rs 3,000 per month on medicines, clinical tests and other check-up by the doctors concerned. These expenses are not reimbursable to me.  Please advise me whether I am entitled to any deduction under Section 80D of the Income Tax Act for the FY 2015-16.  If yes, how much?

In case the clinical test and other check-up are in the nature of preventive health check-up, you would be entitled to claim a deduction of Rs 5,000 in its entirety against your total income. There is no other deduction allowable under Section 80D of the Act to a senior citizen.