Latest Updates
  • NPS Vatsalya sees rising awareness as government promotes early retirement savings for children under 18.
  • Tax benefits up to ₹2 lakh available under Sec 80C & 80CCD(1B) on NPS contributions.
  • PFRDA reports record growth in NPS subscribers across India.
  • NPS Vatsalya sees rising awareness as government promotes early retirement savings for children under 18.
  • Tax benefits up to ₹2 lakh available under Sec 80C & 80CCD(1B) on NPS contributions.
  • PFRDA reports record growth in NPS subscribers across India.
  • NPS Vatsalya sees rising awareness as government promotes early retirement savings for children under 18.
  • Tax benefits up to ₹2 lakh available under Sec 80C & 80CCD(1B) on NPS contributions.
  • PFRDA reports record growth in NPS subscribers across India.
  • NPS Vatsalya sees rising awareness as government promotes early retirement savings for children under 18.
  • Tax benefits up to ₹2 lakh available under Sec 80C & 80CCD(1B) on NPS contributions.
  • PFRDA reports record growth in NPS subscribers across India.
About NPS

Understanding NPS Exit and Withdrawal — Your Options

NPS is primarily a long-term retirement savings scheme, and its exit and withdrawal rules are structured to encourage disciplined saving while also providing flexibility in genuine need situations. Understanding these rules clearly helps subscribers plan their financial journey with confidence.

Exit at Normal Retirement (Age 60)

When a subscriber reaches 60 years of age, they can exit NPS and access their accumulated pension corpus. At this stage:

  • Up to 80% of the total corpus can be withdrawn as a lump sum — and this amount is completely tax-free.
  • At least 20% of the corpus must be used to purchase an annuity from a PFRDA-empanelled Annuity Service Provider (ASP). This annuity provides a regular monthly pension for life.

If the total corpus at retirement is ₹5 lakh or less, the subscriber has the option to withdraw the entire amount as a lump sum.

Continuation Beyond Age 60

Subscribers who wish to remain invested beyond 60 can continue contributing to their NPS account until the age of 85.

Premature Exit Before Age 60

In case a subscriber wishes to exit NPS before turning 60:

  • At least 80% of the corpus must be used to purchase an annuity.
  • The remaining 20% can be withdrawn as a lump sum.
  • This rule applies if the account has been active for at least 10 years.

If the total corpus is ₹2.5 lakh or below, the entire amount can be withdrawn as a lump sum, provided the account has been held for 10 years or more.

Partial Withdrawal — For Life's Unexpected Moments

NPS allows partial withdrawals from the Tier I account in specific circumstances, after a minimum of 3 years from account opening. Permitted reasons include:

  • Children's higher education or marriage
  • Purchase or construction of a residential house
  • Treatment of critical illness (for self, spouse, children, or dependant parents)
  • Disability or incapacitation of the subscriber
  • Starting a new business venture
  • Skill development or vocational training

The partial withdrawal is limited to 25% of the subscriber's own contributions (excluding employer contributions). A maximum of 3 partial withdrawals are allowed during the entire tenure of the account.

Death of the Subscriber

In the unfortunate event of the subscriber's death, the entire accumulated corpus is paid to the nominee. The nominee has the option to purchase an annuity or receive the full amount as a lump sum — whichever they prefer.

NPS Exit & Withdrawal Rules FAQs

Subscribers can withdraw up to 60% of their total corpus tax-free as a lump sum, while at least 40% must be converted into an annuity to yield a regular monthly pension.

If the total pension wealth at superannuation is ₹5 Lakhs or less, the subscriber has the option to withdraw 100% of the corpus as a lump sum without purchasing an annuity.

For premature exit after completing 5 years of subscription, at least 80% of the accumulated corpus must be used to buy an annuity, and up to 20% can be taken as a lump sum.

If the accumulated pension wealth is ₹5 Lakhs or less during a premature exit, the subscriber can withdraw 100% of the funds in a single lump sum without purchasing an annuity.

Partial withdrawals are permitted after completing 3 years of enrolment for specified events, including higher education or marriage of children, construction or purchase of a home, or critical illness treatment.

Subscribers can withdraw up to 25% of their own self-contributions, excluding employer contributions and interest earned, up to a maximum of 4 times during the entire account tenure.

A gap of at least 4 years is required between two consecutive partial withdrawals, except in urgent medical emergencies.

SLW allows retiring subscribers to withdraw their 60% lump-sum corpus systematically in monthly, quarterly, half-yearly, or annual instalments up to age 75 or 85, while the remaining balance stays invested.

Yes, subscribers can voluntarily extend their NPS account and continue contributing up to the age of 75.

100% of the accumulated pension corpus is paid out as a lump sum to the registered nominee or legal heir, or they may choose to purchase an annuity.

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