About NPS
PFRDA launched the National Pension Scheme (NPS) trust under the Indian Trusts Act, 1882. Shri Ashwin Parekh is currently serving as NPS Trust Chairman. National Pension Scheme is a social welfare scheme for distributing pension to private and public sector employees after their retirement. NPS enrolls the Government employees of Central and State governments along with Public sector units. National Securities Depository Limited ( NSDL) offers a variety of National Pension Scheme online services through the eNPS facility on its website.
During the old age, financial security and stability given in the form of pension when People do not have any regular source of income. It is ensured that people have the opportunity to live an established life and maintain their living standards. The pension scheme provides an opportunity for people to invest and accumulate their savings. It gives them a lump sum as a regular income in the form of an annual plan at the time of retirement.
According to the United Nations Population Division, life expectancy in India expected to increase from the current 65 years to 75 years by 2050. The life span has increased due to better health and hygiene conditions in the country. As a result, the number of years of retirement also increased. Thus, the rising cost of living, inflation and life expectancy made the retirement plan an essential part of today’s life. In order to provide social security to more and more citizens, the Government of India has launched the National Pension System.
Online services for National Pension Scheme subscribers on the NSDL
- Opening up of individual Tier 1 or Tier 2 NPS accounts online by National Pension Scheme.
- login into to the eNPS website from NSDL. Any Indian Citizen between the age group of 18 to 65 years can open a pension account under this National Pension Scheme.
- Even NRI subscribers can open their accounts online through eNPS facility.
- Those working in the unorganized sector can apply for Atal Pension Yojana (APY) scheme. They have to fill the prescribed National Pension Scheme form
- It is big relief for pension scheme subscribers. They deactivated or stopped various people’s Tier 2 accounts due to some reasons. Tier 2 National Pension Scheme account holders can activate their account through National Pension Scheme login.
- Recent budget announcements bring an additional NPS tax benefit of 50000 plus 1.5 Lakh National Pension Scheme tax benefits. People can claim it as a deduction under Section 80CCE. Therefore, the total tax benefits for National Pension Scheme under Section 80CCD(1) + Section 80CCD(1B) equal to 2 Lakhs for this financial year. Thus the National Pension Scheme also qualifies as a tax savings instrument.
eNps:
- eNPS allows Tier 1 and Tier 2 subscribers to make the first National Pension Scheme contribution in their account. Later on, they can make monthly or yearly National Pension Scheme contribution by using eNPS. Tier 1 and Tier 2 account contributions by using either SBI epay or Billdesk. List of selected banks is available on the NSDL website.
- National Pension Scheme subscribers can ask all their queries using the web portal. Aggrieved account holders can register their grievances by using National Pension Scheme login.
- National Pension Scheme calculator tool on the website for estimating pension scheme returns after a certain period. Just feed in the amount of voluntary contribution monthly/ yearly and the period of investment. This tool will give you the accurate pension amount you can expect.
National Pension System
The government of India established the Pension Fund Regulatory and Development Authority (PFRDA) on 10th October 2003 for the development and regulation of pension sector in the country. The National Pension System (NPS) was started on January 1, 2004, for the purpose of providing retirement income to all citizens. The goal of NPS is to establish reforms in pension and promote the habit of saving for retirement among citizens.
Initially, NPS was started for new recruits (other than Armed Forces) in government. NPS has been provided to all citizens of the country, including unorganized sector workers on a voluntary basis since 1 May 2009.
In addition to this, the Central Government initiated a cumulative donation pension scheme Swavalamban scheme in the central bank 2010-11 to promote voluntary savings to the unorganized sector for retirement.
Swavalamban Yojana – Under the government provide a sum of Rs 1000 each NPS shareholder, who donates a minimum of Rs 1000 rupees and a maximum of 12000 rupees per year. This plan is currently in force until the financial year 2016-17.
The following important features are proposed on behalf of NPS to assist the subscriber in saving for retirement:
A special permanent retirement account number (PRAN) provided to the subscriber. This specific account number remain permanent till the remaining life of the subscriber. This specific PRAN used in any place in India.
Two personal accounts accessed by PRAN:
Tier 1 Account: This is an account created for saving retirement, which can not be withdrawn.
Tier 2 Account: This is a voluntary savings feature. The subscriber is free to withdraw his savings from this account as he wishes. No tax benefits are available on this account.
Regulatory and NPS units
Pension Fund Regulatory and Development Authority (PFRDA): PFRDA is an autonomous body, established for the development and regulation of pension market in India.
Point of attendance (POP):
Point of presence (POP) is the first point of interaction with NPS structure. Authorized branches of a POP serve as the point of point attendance service provider (POP-SP) collection point and provide multiple customer services to NPS subscribers. Pension Fund Regulatory and Development Authority (PFRDA) National Pension System of the citizens including Public Sector Banks, Private Banks, Private Financial Institutions and Postal Department has authorized 58 institutions as the point of attendance (POP) for opening.
Central Recording Agency (CRA):
Maintenance and customer service work of all the records of the NPS are handled by the National Security Depository Limited (NSDL) which can be used by the Central Record Maintenance Center for NPS Works in the form.
Annuity Service Provider (ASP):
Annuity Service Provider (ASP) – responsible for providing regular monthly pension to the subscriber after leaving NPS.
National Pension System (NPS) trust
Trust Bank
Pension Fund Manager
Frequently Asked Questions on Regulatory and Units of NPS
Who can participate in the National Pension System (NPS)? Who can participate in the National Pension System (NPS)?
Central government employees
NPC Central Government Service (in addition to the Armed Forces) and on January 1, 2004 or later on in Government Service
Central government employees
NPC is applicable to all new employees of Central Government Services (other than the Armed Forces) and Central Autonomous Bodies coming into government service on or after January 1, 2004. Any other government servant who is not mandatorily involved under the NPS can also subscribe under “All Civil Models” through Attendance Point Service Provider (POP-SP).
Subscription process
Central Government employees can subscribe to NPS (Tier-1) through the following process:
Submit Form S1 in Drawing and Disbursing Officer (DDO) or equivalent offices.
Details of employment provided and certified by DDO.
As a result, DDO forward this form to the concerned Pay and Accounts Office (PAO) / District State Fund Officer (DTO).
This form deposited in the Central Recording Agency (CRA)
Subscription in NPS
It is compulsory for Central Government employees to subscribe to the National Pension System (NPS) through their nodal office. Every month, 10 percent of its salary (basic salary + dearness allowance) and its equivalent amount be invested by the government in NPS.
Withdrawal
According to the guidelines of the Pension Fund Regulatory and Development Authority (PFRDA) -or the Ministry of Finance, the subscriber may retire from his service retirement, sacrifice or death by the NPS Can draw.
Pension Fund Regulatory and Development Authority (PFRDA) –
At the time of retirement,listed and Insurance regulatory and development authority (IRDA) – approved annual service providers ASP) – to purchase a life annuity with a minimum of 40 copies of your accumulated savings . About 80 percent of the amount balance can be withdrawn by the subscriber at the time of resignation. In the case of death of the subscriber, the nominee given the full amount.
Form for Central Government employees
Know your NPS Transaction Details
Frequently Asked Questions
State government employees
NPS applicable to all employees of the State Governments, who are involved in State Autonomous Bodies Services after the date of notification of respective State Governments. Any other government servant who not mandatorily involved under the NPS can also subscribe under “All Civil Models” through Attendance Point Service Provider (POP-SP).
Subscription process
State Government employees can subscribe to NPS (Tier-1) through the following process:
Submit Form S1 in Drawing and Disbursing Officer (DDO) or equivalent offices.
Details of employment provided and certified by DDO.
As a result, DDO forward this form to the concerned Pay and Accounts Office (PAO) / District State Fund Officer (DTO).
This form be deposited in the Central Recording Agency (CRA) – for registration.
Subscription in NPS
It is mandatory for the State Government employees to subscribe to the National Pension System (NPS) through their nodal office. Every month, 10 percent of its salary (basic salary + dearness allowance) and its equivalent amount invested by the government in NPS.
Withdrawal
According to the guidelines of the Pension Fund Regulatory and Development Authority (PFRDA) or the Ministry of Finance – the subscriber may retire from his service retirement, sacrifice or death by the NPS Can draw.
At the time of retirement Pension Fund Regulatory and Development Authority (PFRDA) , listed and approved by the Insurance Regulatory and Development Authority (IRDA) – Annual Service Providers (ASPs) – to buy a life annuity A minimum of 40 percent of the savings of the need to invest. About 80 percent of the annuity made annually and balance withdrawn by the subscriber at the time of resignation. In the case of death of the subscriber, the nominee given the full amount.
Form for State Government employees
Know your NPS Transaction Details
Corporate
It is the flexibility to choose investment in the corporate world and they can adopt it centrally at the subscriber level or at the corporate level for all its subscribers. Under the ‘All Civil Model’, corporate or subscriber can choose any of the Pension Fund Manager (PFM) – as well as the percentage of funds allocated in various asset classes.
Benefits for corporate
National Pension System (NPS) – In the corporate model, a platform provided to the corporate for co-subscription for the employee’s pension. Corporate pension also saved in self-governing expenses for administration. The establishment of separate trusts, keeping records, fund management, annual giving etc. Under NPS, corporates use the option of PFM for their employees or employees can opt out.
NPS a discretionary regulated plan with transparent investment norms. The performance of the fund managers regularly and monitored in the overall supervision of PFRDA & by NPS Trust. In the context of investment mixing options in corporate and government bond equity, there is a lot of flexibility (up to 50 percent).
Those who not financially aware or not inclined can adopt the option of life cycle funds in NPS, in an effortless manner to manage the fund in which the amount of equity 50% per annum decreases by 2% till the investor gets 35 Percentage remains. In this, the risk of adopting an alternative strategy for a high-risk high-profit portfolio mix taken care of in the early days when enough time to handle a possible accident. The person can gradually adopt the short-term portfolio of fixed profit till the time of retirement. It also as the option of PFM and investment patterns changed once a year.
The employer can claim tax benefit on the amount paid to the contribution of the employee’s pension to up to 10 percent of the salary (basic and dearness allowance), which is applicable to profit and loss account under section 36 (1) of the IT Act. Is taken as the expense.
Benefits for the subscribers
Plan accumulated from the age of 18 to 40 years of age. Regardless of they live and the employer is able to pay tax concessions to a PRAN account with minimum expenditure as a drawal for competing consumer expenditures. Can benefit from joint effects and short duties, and fulfill the risk of the person with the commercially managed funds, the accumulated condition Seven IRDAs. According to the option person till the age of 60 years from the uninterrupted transfer of retirement property from the retirement, Regulated Annual Service Providers (ASP)
An additional tax benefit employee after joining NPS in accordance with Income Tax Act, 1961, which is the most important feature of this scheme. Subscriber’s contribution to NPS Tier 1 is 10% of the salary (Basic + Dearness Allowance) under section 80CCD (i). There is a limit of Rs. One lakh under Section 80 CCE. Apart from this, a concession given to the employee under section 80CCD (2) of the Income Tax Act. Employee contribution of up to 10 percent of the salary. This concession is above the limit of Rs 1 lakh, so the NPS becomes a special option for this tax treatment.
Hence, by contributing to the NPS, the employer can make additional tax benefits to the employee by reorganizing the salary structure without any additional company expenditure (CTC).
Subscription process
Through the Memorandum of Understanding, the company can provide NPS to its employees by an alliance with any approved POP. An eligible corporate unit is free to negotiate the charge with POP, where POP-SP work to upload the entire data according to all civil models.
Corporates can register for NPS through the following process:
SHO-1-PDF file with details of corporate branch functions along with nominated POP, submit the form.
The nominated POP ensure the duly compulsory of the position of required corporate status (KYC) mandatory. It verified as per the AML / CFT guidelines issued by the Government of India and duly certified Central Recording Agency (CRA).
The corporate registered in the CRA system by the CRA and it allotted the unit registration number, displayed in the form of each subscriber (CS-S1) – PDF file.
Contribution to NPS
A corporate have the flexibility to select investment plan priorities (PFM and investment options) for all its subscribers centrally at the subscriber level or at the corporate level.
A quick roundup of the additional services offered by the eNPS from NSDL
- Updation of FATCA details especially crucial for NRI subscribers who follow tax rules of their residential country.
- Feeding Aadhaar Card number by NPS login.
- You can update the address, mobile number, and email id.
- Make changes to the National Pension Scheme preferences
- Get a fresh printout of your Permanent Account Retirement Number (PRAN) Card.
- View NPS account details and get period wise transaction statement.
- Withdraw money from your Tier 2 NPS account.
- Download appropriate NPS form from this eNPS website from NSDL.
Corporate National Pension Scheme subscribers can also use the same website http://enps.nsdl.com/ and avail the same benefits as Individual subscribers.
Important Details of NPS
- NPS Website: https://enps.nsdl.com
- National Pension System FAQ’s: https://npscra.nsdl.co.in/all-citizens-faq.php
- NPS Head Office: NSDL e-Governance Infrastructure Limited
1st Floor, Times Tower, Kamala Mills Compound, Senapati Bapat Marg, Lower Parel, Mumbai – 400 013 - National Pension System Trust Helpline Number: 022-4090-4242
- NPS FAQ’s: https://npscra.nsdl.co.in/all-citizens-faq.php
- National Pension System Facebook: https://www.facebook.com/nps.NSDL