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You Should Know about National Pension Scheme

National Pension Scheme, National Pension Plan, NPS, Details of National Pension Scheme, Benefits of National Pension Scheme, Central Government Schemes, State Government Schemes, List of All Government Schemes, Government Schemes

The Central Government of India led by NDA Leader and the Hon’ble Prime Minister of India Shri Narender Modi has launched a low-cost, tax-efficient and flexible retirement savings scheme i.e. National Pension System (NPS).

The National Pension Scheme is one of the saving schemes where anyone can invest money monthly or through a systematic saving plan during your working life to get an adequate retirement income. Under this scheme, all Indian citizens of 18 to 60 years of age, including NRIs are eligible to apply for a pension fund account.

The National Pension Scheme is a quarterly equity instrument in which 40% of the corpus escapes tax at maturity, whereas 60% of the corpus is taxable. Anyone can open NPS account individually with any of the national banks or as an employee. Besides this, an applicant can also contribute to his.her retirement account and so does your employer, who can or cannot co-contribute for the social security/welfare of the individual.

What is the National Pension Scheme

National Pension Plan is the cheapest market-related retirement plan between all other retirement plans (EPF, PPF and mutual funds), it suggests that this maximum number of sales will be recorded. But due to very little pays incentives/commissionission for middlemen, they are not getting promotions.

When the plan started, the scenario was poor, the cost of fund management was limited to 0.0009 percent and the attendance points or POP where investor accounts were opened, they were not allowed to charge more than Rs 20 per account, no matter how big Why not invest only. In addition to an annual CRA of 225 rupees, there was also a fee for opening a 50 rupee account for the CRA.

The fund management fee for non-government funds has now increased to 0.25 percent and for the government, funds it has increased by 0.0102 percent. Also, POPs are allowed to charge more than 100% of the investment of 0.25%. This change will definitely act as an incentive for the agents who will now actively present the product in the market.

Accordingf to the latest updates of 2016, an additional tax benefit of Rs 50,000 under Section 80CCD (1b) of Income Tax Act is given under NPS, which is more than Rs 1.5 lakh exemption of Section 80C.

This change will be implemented from April 1, 2018 and will, accordingly, apply in relation to the assessment year 2018-19. NPS is a market-linked annuity product.

Eligibility Criteria for NPS

A citizen of India, whether resident or non-resident, who complies with the following conditions.

Any individuals aged between 18 to 60 years as on the date of submission of his/her application to the Points of Presence (POP)/POP-Service Providers (SP).

All citizens can join NPS either as individuals or under the employee-employer group(s) post the submission of all required information and KYC documentation.

Types of National Pension Plans (NPS)

There are two types of NPS accounts

Tier-1 Account

It has a basic pension account with borders on the return

Only 20% of the contribution can be withdrawn before the age of 60 years can be withdrawn, whereas the remaining 80% is required to be used by the life insurance company to buy the annuity. Annuity is a series of payments made at fixed intervals of time. Annuity plans require insurers to pay insured income at regular intervals till their death or till maturity of the plan.

Even after retirement (60 years), 60% contribution can be taken close and remaining 40% can be used to purchase annuity from approved life insurance companies.

Tier II Account

This is a voluntary saving option, so that a person can withdraw money unlimited.

 Read More: National Pension Scheme, National Pension Plan, NPS, Details of National Pension Scheme, Benefits of National Pension Scheme, Central Government Schemes, State Government Schemes, List of All Government Schemes, Government Schemes

Source: Free Articles from ArticlesFactory.com

ABOUT THE AUTHOR


Hello Readers, Myself Prince Vajpayee I am working for My Government Schemes a web page that provides complete information about the Central Government Schemes, State Government Schemes, List of All Government Schemes, Government Schemes

 



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