Are you aware of these rule changes of NPS
National Pension System (NPS) is one of the most popular saving/investment options. It is a government-sponsored scheme which offers Income Tax benefits. It is a voluntary contribution scheme under which the employee contributes 10 per cent of his salary including dearness allowance as a mandatory monthly contribution and a matching contribution by the employer.
Recently, The Pension Fund Regulatory and Development Authority (PFRDA) has made some changes to the investment guidelines in some of the NPS schemes. The PFRDA circular stated, “In order to provide flexibility to the pension funds to improve the scheme performance depending upon the market conditions, it has been decided to increase the cap on government securities and related investments and short-term debt instruments and related investments by 5% each.”
It may be noted that these changes have come into effect from April 1 and they apply to NPS-Central Government Scheme (CG), State Government Scheme (SG), Corporate Central Government (CG) scheme, Life schemes of NPS and the Atal Pension Yojana. With these changes, 55% investment in government securities and up to 10% in short-term debt instruments and related investments, is allowed now.
Also, PFRDA changed the rules for withdrawal of National Pension System (NPS) for the benefit of subscribers, last year. In order to aid the subscribers, the requirement of the minimum period under NPS for partial withdrawal……..Read More>>