Home >>ACMIIL Home >> ACMFSL Home >> ACMRES Home >> Resume Status Home >> Apply Now Home >> Culture Home >> Current Opening Home >> Deenas World Home >> Faq's Home >> Financial Terms Home >> Five W’s of Investment Home >> Health Checkup Home >> Investmentz Online Home >> Management Team Home >> Media Corner Home >> NRI Center Home >> Register Now Home >> Research Home >> FAQ's Home >> Knowledge Support Home >> Why Investmentz Home >> Sitemap Home >> Career Home >> Gallery Home >> Feedback Home >> Disclaimer Home >> Privacy Home >> Services Home >> Tools & Platforms Home >> Investment Products Home >> About Us Home >> Contact Us Home >> Download Home >> Security Home >> My Subscription Home >> Retail Investors Home >> NRI Investors Home >> Institutional Investors Home >> Corporate Clients Home >> Bank Home >> Alternate Investment Fund Home >> Financial Planning Home >> Investment Advisory Home >>Portfolio Tracking


  Change Font Size: A+ A-

5 taxation rules on National Pension System (NPS) you need to knowOverall RATE RATE (5.00)

National Pension System or NPS is a defined contribution based pension scheme launched by the Government of India on January 2004, which aims to provide regular income during old age and generates market-linked returns over the long term. 

Two types of account under NPS- tier I and tier II. The tier I account is pension account and mandatory account with facility of partial withdrawal subject to certain conditions (like critical illness, child education etc.) and , while the tier II account is a savings account and optional account and can be withdrawn any time. But the investment you make in tier II account will not qualify for tax benefits. Both salaried, as well as self-employed individuals, get income tax benefits on investing in NPS. A salaried person can increase his/her take-home salary by investing in NPS. 

Here are the tax benefits of NPS you need to know:

  1.  Salaried individuals can get an additional tax deduction of Rs 50,000 by investing in NPS under section 80CCD(1B) of Income Tax Act over and above the limit of Rs 1.5 lakh under Section 80CCD. 

  1. Under section 80CCD of Income Tax Act 1961, a salaried individual can contribute up to 10 per cent of his salary (Basic+ DA) subject to a maximum of Rs 1.5 lakh in a year in NPS tier-I account to get tax deduction.  

  1. Self-employed people can deposit up to 20 per cent of their gross income in a year subject to a maximum of Rs 1.5 lakh in NPS tier I account to get tax deduction. Also self-employed person will get an additional deduction of Rs 50,000 for investing in NPS under section 80CCD(1B). 

  1. Tax rules on partial withdrawal: You can partially withdraw from NPS tier I account before the age of 60 for specified purposes. According to Budget 2017, amount withdrawn up to 25 percent of your contribution is exempt from tax. 

  1. Tax rules on retirement benefit: After you attain the age of 60, up to 40 percent of the corpus (market value) withdrawn in lump sum is exempt from tax.

So Hurry up, don’t miss opportunity to save tax also by investing in NPS one can be rest assure of a regular flow of income after age 60. To open NPS account Click here or write us at nps@acm.co.in



Written by : blog admin

Today’s Poll

Today’s Poll
Will the 'bears' stop the 'bulls' from making new highs?

Most Read

3 simple steps to financially secure th... by blog admin 01-Jan-2018, 00:00 Hours IST
Make National Pension Scheme your gatew... by blog admin 11-Jan-2018, 00:00 Hours IST
4 easy ways to save more money by blog admin 25-Jan-2018, 00:00 Hours IST
SEBI Reg. Nos | BSE CM:INB 010607233 & Derivatives:INF 010607233 | NSE CM:INB 230607239 | Derivatives INF 230607239 & Currency Derivatives INE 230607239 | MCX SX INB 260607230 | Derivatives INF 260607230 and Currency Derivatives INE 260607230 | DP: IN-DP-CDSL-28-99 and Merchant Banking INM000010973.