NPS Calculator

NPS offers tax benefits beyond Section 80C. Under Section 80CCD(1B), you can claim an additional deduction of up to 50,000 for NPS contributions over and above the 1,50,000 80C limit.

Yes, NPS allows you to choose your asset allocation between equity, corporate bonds, and government securities. You can also opt for Auto Choice where the allocation is managed based on your age.

NPS is portable across jobs and locations. When you change employers, your NPS account continues to exist and can be transferred.

In the unfortunate event of the subscriber's death before retirement, the entire accumulated NPS corpus is paid to the nominee or legal heir. The nominee has the option to either withdraw the full corpus as a lump sum or continue the NPS account. If the corpus exceeds ₹5 lakh, the nominee may be required to annuitise at least 40% of the corpus.

Yes, partial withdrawals from NPS are permitted under specific conditions after a minimum lock-in period of 3 years from the date of account opening. You can withdraw up to 25% of your own contributions for specified purposes such as children's higher education, marriage, purchase or construction of a house, or medical treatment of critical illnesses. A maximum of three such withdrawals is allowed during the entire tenure.

To open an NPS Tier I account, the minimum initial contribution is ₹500 for the individual's own contribution. The minimum annual contribution is ₹1,000, and each contribution must be at least ₹500. For Tier II accounts, the minimum initial contribution is ₹1,000, and the minimum annual contribution is ₹250. If the minimum balance requirement is not met, the account may be frozen or deactivated.

NPS and EPF serve different purposes: EPF is a mandatory contributory scheme for salaried employees with a fixed interest rate declared annually by EPFO, while NPS is a voluntary market-linked scheme where returns depend on the chosen asset allocation. NPS offers higher potential returns (8-12% p.a.) but carries market risk, while EPF offers stable returns (typically 8-8.5%). NPS also provides additional tax benefits under Section 80CCD(1B) beyond the 80C limit.

Self-employed individuals contributing to NPS can claim deductions under Section 80CCD(1) up to 20% of their gross income (as against 10% for salaried employees), subject to the overall ₹1.5 lakh limit under Section 80CCE. Additionally, they can claim up to ₹50,000 under Section 80CCD(1B) over and above the 80C limit. Employer contributions are not applicable for self-employed persons, but they can contribute up to 20% of gross income to NPS.

An individual can have only one NPS Tier I account and one NPS Tier II account as per Pension Fund Regulatory and Development Authority (PFRDA) guidelines. If you have opened multiple accounts by mistake, you must consolidate them by transferring the corpus from one account to another through the NPS portal. Duplicate accounts may be deactivated, and the corpus in the deactivated account must be transferred to the active account.

At retirement (age 60), you can withdraw up to 60% of the NPS corpus as a tax-free lump sum. The remaining 40% must be used to purchase an annuity from a registered life insurance company, which will provide a monthly pension. If the total corpus is less than ₹5 lakh, you can withdraw the entire corpus as a lump sum without purchasing an annuity. Early exit before 60 requires annuitisation of at least 80% of the corpus.