Secure Your Retirement, Grow Your Wealth, and Maximize Tax Benefits
The National Pension System (NPS) is a voluntary, Government-backed, defined contribution retirement scheme designed to help individuals plan for a financially independent future. By systematically saving during your working years, NPS encourages disciplined wealth creation for a secure retirement.
Types of NPS Accounts
- Tier I Account – Retirement-Focused
- Non-withdrawable until the age of 60 or retirement.
- Encourages long-term wealth accumulation.
- Tier II Account – Flexible Savings
- Functions as a voluntary savings account.
- Withdraw anytime, offering liquidity and flexibility.
Investment & Returns
- Market-linked growth: A portion of your contributions is invested in equities, aiming for higher returns.
- Historical performance: 9%–12% per annum (compared to PPF at 7.10%).
- Combines investment and pension benefits in a single scheme.
Exclusive Tax Benefits
For Employees
Self-contribution
- Up to 10% of salary (Basic + DA) under Section 80CCD (1), within ₹1.5 lakh ceiling under Sec 80CCE.
- Additional ₹50,000 deduction under Section 80CCD(1B) over the ₹1.5 lakh limit.
Employer contribution
- Tax deduction up to 10% of salary (14% for Central Government employees) under Section 80CCD (2), beyond the Rs 1.5 lakh limit.
For Self-Employed Individuals
- Up to 20% of gross income under Section 80CCD (1), within ₹1.5 lakh ceiling.
- Additional ₹50,000 deduction under Section 80CCD(1B).
Partial Withdrawals
- Up to 25% of self-contribution is tax-free under Section 10(12B), subject to PFRDA guidelines.
Lump Sum Withdrawal & Annuity
- 60% of accumulated pension wealth is tax-exempt on withdrawal at age 60 under Section 10(12A).
- Option to defer withdrawals and stay invested until 75 years.
- Deferred lump sum can be withdrawn in phases over 15 years or in a single pay out.
- Purchase of annuity is tax-exempt under Section 80CCD (5); annuity income thereafter is taxable.
For Corporates/Employers
- Employer contributions up to 10% of salary (Basic + DA) are allowed as business expense deductions under Section 36(1)(iv)(a).
Eligibility
- Indian Citizens (Resident & Non-Resident)
- Age: 18–70 years
Why NPS?
- Structured, long-term retirement savings
- Market-linked growth potential
- Multiple avenues for tax savings
- Flexible withdrawal and annuity options
Start your journey towards a secure and prosperous retirement today.