NPS withdrawal rules changed: Now, National Pension System (NPS) subscribers can withdraw the entire accumulated pension at one go, without purchasing an annuity if the corpus is less than Rs 5 lakh. The Pension Fund Regulatory and Development Authority has recently amended the rules to make NPS a more lucrative option for the investors. “…where the accumulated pension wealth in the Permanent Retirement Account of the subscriber is equal to or less than a sum of Rs 5 lakh, or a limit as specified by the Authority, the subscriber shall have the option to withdraw the entire accumulated pension wealth without purchasing annuity and upon such exercise of this option, the right of such subscriber to receive any pension or other amount under the National Pension System or from the government or employer, shall extinguish,” it said.

In a gazette notification, the pension regulator also stated that the premature withdrawal limit on a lumpsum basis for NPS has been increased to Rs 2.5 lakh from Rs 1 lakh.

“…Where the accumulated pension wealth in the Permanent Retirement Account of the subscriber is equal to or less than a sum of Rs 5 lakh, or a limit as specified by the Authority, the subscriber shall have the option to withdraw the entire accumulated pension wealth without purchasing annuity and upon such exercise of this option, the right of such subscriber to receive any pension or other amount under the National Pension System or from the government or employer, shall extinguish,” it said.

Can you withdraw full money from NPS?

According to pension regulator PFRDA, subscribers whose pension amount accumulated in the Permanent Retirement Account is Rs 5 lakh or less or as per the limit set by the authority, such subscribers will have the option to withdraw the entire pension amount without buying an annuity. Buying an annuity here means buying a pension plan from insurance companies.

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What were the old NPS Withdrawal Rules?

At present, if NPS subscribers whose total corpus is more than Rs 2 lakh, are required to buy an annuity from insurance companies at the time of retirement or on attaining 60 years of age. Subscribers can withdraw 60% of their money in a lump sum, but it is mandatory to buy an annuity with the remaining 40%.

Any individual citizen of India (both resident and Non-resident) in the age group of 18-65 years (as on the date of submission of NPS application) can join NPS. Although, opening multiple NPS accounts for an individual is not allowed under NPS, an Individual can have one account in NPS and another account in Atal Pension Yojna.

Any individual citizen of India (both resident and Non-resident) in the age group of 18-65 years (as on the date of submission of NPS application) can join NPS. But, don’t be confused with joint account.