National Pension Scheme (NPS): - It is a voluntary retirement benefit scheme introduced by the Government of India to facilitate regular income post-retirement for all subscribers.
- A citizen of India, either a resident, non-resident, or an Overseas Citizen of India, can open an NPS account.
- It helps individuals build a retirement corpus by making regular contributions throughout their careers.
- NPS contributions are invested in market-linked instruments such as stocks and bonds, providing the potential for higher returns compared to traditional fixed-income options.
- Subscribers also have the option to exit this plan before retirement or opt for superannuation.
- It is based on a unique Permanent Retirement Account Number (PRAN), which is allotted to every subscriber. NPS account or PRAN will remain the same irrespective of changes in employment,city, or state. It can be used from any location in India.
- PFRDA (Pension Fund Regulatory and Development Authority) is the governing body for NPS.
- Contributions to the NPS are eligible for tax deductions under Section 80C and an additional deduction of up to ₹50,000 under Section 80CCD(1B).
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