NPS Exit and Withdrawal Rules 2021: The Pension Fund Regulatory and Development Authority has notified many new amendments to National Pension System (NPS) exit and withdrawal guidelines. Named ‘Pension Fund Regulatory and Development Authority (Exits and Withdrawals under the National Pension System) (Amendment) Regulations, 2021’, the new regulations have changed many guidelines with regards to exit and withdrawals from the NPS. Now a subscriber can withdraw up to Rs 5 lakh from the permanent retirement account without having acquiring a pension strategy.
Take a look at some of the leading adjustments:
Full withdrawal up to Rs 5 lakh
If the accumulated pension wealth in the Permanent Retirement Account of the subscriber is equal to or significantly less than Rs 5 lakh, or a limit as specified by the Authority, the subscriber will have the choice to withdraw the whole accumulated pension wealth without having buying annuity. After the workout of this choice, the suitable of such subscriber to acquire any pension or other quantity below the NPS, or from the government or employer, will extinguish.
Subscription beyond 60 years
If the subscriber desires to continue in the NPS and contribute to his retirement account beyond the age of 60 years or the age of superannuation, he or she can do so by providing in writing or in such kind as may perhaps be specified, and up to which he would like to contribute to his person pension account but not exceeding 70 years of age.
This choice demands to be exercised at least 15 days prior to the age of attaining 60 years of age of superannuation, as the case may perhaps. However, in such instances, person pension account/ Permanent Retirement Account will be shifted from the Government sector to All citizens like the corporate sector and the expenditures, upkeep charges and charge payable below the NPS in respect of the mentioned person pension account/Permanent Retirement Account will continue to stay applicable.
Extension on account of minimum age
If the accumulated pension wealth of the subscriber is more than Rs 2.5 lakh or a limit to be specified by the Authority for the objective, but the age of the subscriber is significantly less than the minimum age expected for buying any annuity, such subscriber will continue to be subscribed to the NPS, till he or she attains the age of eligibility for buy of any annuity.
However, in such instances, if the accumulated pension wealth of the subscriber is equal to or significantly less than Rs 2.5 lakh, such subscriber will have the choice to withdraw the whole accumulated pension wealth without having buying any annuity.
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If the subscriber attains the age of 60 years or superannuates in accordance with the service guidelines applicable to such subscriber, at least 40 per cent out of the accumulated pension wealth of such subscriber shall be mandatorily utilised for buy of annuity giving for a month-to-month or any other
periodical pension and the balance of the accumulated pension wealth, soon after such utilization, will be
paid to the subscriber in lump sum.
Annuity deferment
The subscriber will have the choice to defer the buy of annuity for a maximum period of 3 years, from the date of attainment of 60 years of age or the age of superannuation, as the case may perhaps be. However, for this, the subscriber will have to intimate his or her intention to do so in writing in the specified kind at least 15 days just before the attainment of age of 60 years or the age of superannuation, as the case may perhaps be, to the National Pension System Trust or any intermediary or other entity authorized by the Authority for this objective.
It will be a prior situation to opt for such deferment of annuity buy, that in case if the death of the subscriber happens just before such due date of buy of an annuity soon after the deferment, then the whole accumulated pension wealth of the subscriber will be paid to the nominee(s) or legal heir(s), as the case may perhaps be, of such subscriber.