NPS Calculator

NPS Tier-1 is a long-term retirement account with three asset classes: Equity (E, max 75%), Corporate Debt (C) and Government Securities (G). Subscribers choose Active (self-allocation) or Auto Choice (lifecycle-driven). Account locked till age 60 — except partial withdrawal for specific milestones.

Partial withdrawal up to 25% of own contribution is allowed for specific milestones (children's education, medical, house purchase, etc.) after 3 years from joining. Premature exit (before 60) requires 80% of corpus to be annuitised, with the remaining 20% as lump-sum.

At age 60, NPS mandates 40% of corpus to be annuitised (used to purchase an annuity from a PFRDA-empanelled insurer). The remaining 60% is withdrawable as lump-sum, fully tax-free. Subscriber can opt for higher annuity (up to 100%) to reduce lump-sum tax-free component.

Lump-sum withdrawal up to 60% is fully exempt from tax under Section 10(12A). Annuity income is fully taxable at slab rate. Capital gains on the lump-sum are not taxed separately, but the corpus invested in E / C / G is itself taxed at the entry (via the 80CCD deduction).

Section 80CCD(1B) allows additional ₹50,000 deduction over and above the 80C ceiling for NPS Tier-1 contributions by the employee — available to all categories (salaried, self-employed, Central + State Govt). Combined with 80C, total NPS+Section 80C deduction can reach ₹2 lakh per year.

Section 80CCD(2) allows the employer's NPS contribution to be fully exempt from employee's taxable salary. For Central / State Government employees, the limit is 14% of basic + DA. For private-sector employees, 10% of basic + DA. This is over and above the 80C + 80CCD(1B) ceiling.