NPS started with the decision of the Government of India to stop defined benefit pensions for all its employees who joined after 1 April 2004. While the scheme was initially designed for government employees only, it was opened up for all citizens of India between the age of 18 and 65 in 2009, for OCI card holders and PIO's in October 2019.[3] On August 26, 2021, PFRDA increased the entry age for the National Pension System (NPS) from 65 years to 70 years. As per the revised norms, any Indian Citizen, resident or non-resident and Overseas Citizen of India (OCI) between the age of 65-70 years can join NPS and continue or defer their NPS Account up to the age of 75 years.[4] It is administered and regulated by the Pension Fund Regulatory and Development Authority (PFRDA).
- Additional Tax benefits
- Lump-sum withdrawal
- 100% Safe & Secured
- NPS offers an additional deduction of ₹ 50,000/- u/s 80CCD (1B)
- Withdraw up to 60% of corpus accumulated on maturity
- Hassle-free access
- Backed by GOI
- Low cost & Zero hidden charges
- Permanent Retirement Account Number (PRAN)
- Minimum ₹ 1,000/- in a financial year with no hidden charges
Tier I Account
Contributions done to this account are eligible for an additional tax deduction benefit of up to ₹ 50,000/- u/s 80CCD (1B), over and above ₹ .1,50,000/- u/s 80C. 60% of the invested amount can be withdrawn on completing 60 years and the rest will be used to provide annuity.
Tier II Account
One can invest an additional amount in Tier II NPS Account. This amount can be entirely withdrawn at any point of time. No tax benefits are available in this account. Kindly note that in order to open a Tier II account, it is mandatory to open a Tier I account first.
A subscriber can invest in both types of accounts under One Permanent Retirement Account Number (PRAN).
National Pension System Trust is a specialised division of Pension Fund Regulatory and Development Authority which is under the jurisdiction of Ministry of Finance of the Government of India. The National Pension System is a voluntary defined contribution pension system in India.