NATIONAL PENSION SYSTEM
- Pension Fund Regulatory and Development Authority (PFRDA) is an Authority to promote old age income security by establishing, regulating and developing pension funds to protect the interest of subscribers in schemes of pension funds and for matters connected therewith or incidental thereto.
- National Pension System (NPS) means the contributory pension system whereby contributions from subscribers along with matching contributions from respective governments as an employer, are collected and accumulated in an individual pension account. NPS uses a system of Government/ Autonomous Bodies'
Nodal offices,
a Central Recordkeeping Agency (CRA) and
designated Pension Funds (PFs), as specified by the respective regulations from time to time to achieve synergy and maximum efficiency in operations. - NPS is mandatory to all employees joining services of Central Government (except Armed Forces) and Central Autonomous Bodies on or after tat January 2004. Almost all State Governments have adopted NPS architecture and have implemented NPS mandatorily through Gazette Notifications for the State Government/ Autonomous body employees joining on or after their respective cut-off dates.
- As a subscriber under NPS you are provided with an individual pension account identified by Permanent Retirement Account Number (PRAN) which is unique & portable across locations and employments.
The Card provided to you contains
your PRAN,
Father's name,
Photograph and
Signature/ Thumb impression. - Along with your PRAN card you are also provided with Internet Personal Identification Number (I-PIN) and Tele-query Personal Identification Number (T-PIN) through which you can access your pension account via internet (through CRA website www.npscra.nsdl.cain) or telephonically at CRA Helpline (1800222080), respectively.
Benefits of NPS
- Dual benefit of Low Cost & Power of Compounding: The pension wealth accumulates over a period of time till retirement; grows with a. compounding effect and the account maintenance charges being low, larger would be the eventual benefit of the accumulated pension wealth
- Tax Benefits: Benefits available under Section 80 CCD(1) and 80 CCD(2) as per relevant sections of Income Tax Act 1961, as amended from time to time.
- Safety: Regulated by the Pension Fund Regulatory & Development Authority (PFRDA) and introduced by the Government of India Transparency: Through online access to your pension account.
- Portability: Across all geographical locations and employments across India
Under NPS, two types of accounts are available to you i.e., Tier I & Tier II
- A. Tier I account - where you and the Government contribute funds into your individual account. As a subscriber you contribute 10% of your Basic Pay and DA into your Tier-I account on a mandatory basis every month, which is invested along with the matching contribution from the employer. The regular NPS contributions and the accumulated amounts are reflected in your PRAN while you are in service and shall be used at retirement for procurement of your pension.
- B. Tier II account - a voluntary savings account from which you are free to withdraw the savings at your own choice. An active Tier I account along with PRAN is a pre requisite for opening of a Tier II. You can approach any Point of Presence- Service Provider (POP-SP- list available at CRA website) for activation of Tier II account along with a copy of PRAN card and PAN card. Further more, since Tier II is a voluntay saving account, the government does not contribute any amount into your Tier II account and no tax benefits are available for the contributions made.
Read more: http://www.teachersbadi.in/2014/10/how-to-update-cps-holders-personal.html#ixzz3GyuBRRKI
