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  • Category: Miscellaneous

    Alert: NPS subscribers! There is an important change in NPS

    NPS has become important for many people. Now Government employees both at Central level and State level compulsorily subscribe to NPS. Many employees in organised sectors are depending on NPS for pension after retirement. Now people can also subscribe to NPS in personal capacity. To encourage NPS subscription, the Government has changed the provision of IT Act and has allowed tax saving upto Rs. 50,000/- over and above earlier Rs. 1 lakh under Section 80C of the Act.

    But last week, there has been another important change in NPS. Taking into account the fact that nowadays many people work till 65, NPS regulators' Chairman has announced that the upper age limit of NPS subscribers has been increased to 65 from earlier 60.

    So, NPS subscribers! Please take note of this important change and go on investing in NPS till you reach 65 and enjoy a safe and secured retired life with more saving in NPS and consequently more pension.
  • #617726
    By the way Partha please let me know what is NPS. How it is helpful for the working and retired government employees. How the investments are protected with returns ?
    K Mohan
    'Idhuvum Kadandhu Pogum "
    Even this challenging situation would ease

  • #617728
    National Pension System (NPS) is a government-sponsored pension scheme. It was introduced in January 2004 for only government employees. But in 2009, the scheme was extended to all sections. In this scheme, subscribers can contribute regularly to a pension account while they are in service. On retirement, the subscriber can withdraw a part of the amount and use the remaining amount to buy an annuity. Any person between 18 and 65 years age can join. .Anyone interested in joining can approach Point of Presence (POP). Many private and public sector banks are enrolled as POPs. This will be helpful to private employees who don't have any pension scheme.
    drrao
    always confident

  • #617741
    Thanks Partha to sharing information about National Pension System (NPS) . It is really a good news. I am subscriber of National Pension System (NPS) but I have no idea about latest change on tax saving .
    Phagu
    Success occurs when opportunity and preparation meet.

  • #617771
    Good information Mr.Partha, the increased slab for tax saving looks like an incentive to attract more deposits. To me, such plans need to grow and be managed by excellent fund managers to give us good value. By increasing the age limit, we are being encouraged to invest for 5 years more which indirectly means that we cannot encash for 5 more years extra?

  • #617792
    Mr. Phagu Mahato: The additional Rs. 50,000/- tax benefit on NPS contribution has been initiated two financial years before (Section 80CCD). All of us must avail this benefit.

    Mr. Natarajan: NPS subscribers after 10 years become eligible for partial withdrawal under specific circumstance like children's higher education or marriage, construction or purchase of house and treatment of critical illness (for self, spouse, children or dependent parents). Early withdrawal is allowed up to 25% of one's contribution. Furthermore, from the current year, early withdrawals to the extent of 25% of the contributions will not attract income tax.

    So, there is no relationship between the increase in subscription age and withdrawal.

    Caution: Explosive. Handle with care.


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