Reviewed by Artha Research·Last updated 8 April 2026
PPF vs EPF — Which Tax-Free Debt Wins?
Compare PPF and EPF returns for the same annual contribution at current government rates.
Your numbers
Same annual contribution, different Government-backed vehicles.
Winner's corpus
₹45L
EPF wins
EPF's higher rate (8.25% vs 7.1%) compounds into ₹4.3L more over 15 years.
Rates change. Government resets PPF quarterly and EPF annually. Revisit this comparison when either rate changes.
PPF vs EPF
EPF
₹45L
WinnerPPF
₹40.7L
EPF wins by 11%.
PPF corpus
₹40.7L
EPF corpus
₹45L
PPF rate
7.1%
EPF rate
8.3%
Eligibility differs
Anyone can open a PPF account. EPF is only for salaried employees, and employer contributions are mandatory at 12% of basic. If you're self-employed, PPF is the only option.
Next best actions
The result hints at what to look at next. Each link carries your current numbers so you never re-enter them.
At a glance
- Question answered
- For the same annual contribution, which Government-backed tax-free instrument builds more corpus?
- Typical verdict
- EPF currently wins on rate (8.25% vs 7.1%), but only salaried workers can use it. For self-employed, PPF is the only option of the two.
- Eligibility
- PPF: anyone, ₹1.5L/year cap, 15-year lock-in. EPF: salaried only, 12% of basic mandatory, tax-free after 5 years of service.
- Best used for
- Deciding the debt allocation of a long-term portfolio and whether to top up EPF via VPF.
How It Works
This is the drill-down layer. The flagship flow leads with a recommendation, and this page lets you inspect the underlying model.
- Both instruments compound annually at their stated rates.
- PPF rate is revised quarterly; EPF rate is revised annually by EPFO.
- Contributions are capped at ₹1.5L/year for PPF; EPF contributions follow the 12% of basic rule.
Assumptions
The recommendation stays blunt, but the assumptions remain visible.
- For the comparison, EPF is modelled as if it received the same annual contribution — a simplification for fair comparison.
- Both are tax-free under their respective sections.
- Government can revise either rate; re-check when rates change.
FAQ
The follow-up questions people usually ask after the main recommendation is already clear.
Is EPF always better than PPF?
At current rates (8.25% vs 7.1%), yes — but only if you're salaried and have an employer EPF account. For self-employed or non-salaried workers, PPF is the only option of the two.
Can I open a PPF even if I have EPF?
Yes. They coexist. Many salaried employees max out 80C by combining EPF + PPF contributions.
Which has better tax treatment?
Both are EEE (contribution, interest, and maturity exempt) when conditions are met. EPF's tax-free status requires 5+ years of service.
Sources & references
Every formula and assumption above is grounded in these authoritative sources.
Related tools & decisions
Keep going from here — each link carries the same cluster context.
Sibling tools
Comparison pages