National Pension Scheme (NPS) benefits


National Pension Scheme (NPS) benefits:


Employee Tax Benefits for Self-Contribution

Tax deduction up to 10% of pay (Basic + DA)

Maximum limit of Rs. 1.50 lakh

Additional Tax deduction up to Rs. 50,000

Section 80 CCD(1)

Section 80CCE

Section 80 CCD(1B)

Employee Tax Benefits on Employer Contributions

Tax deduction up to 10% of salary (Basic + DA)

14% if contribution by Central Government

Beyond Rs. 1.50 lakh limit provided by Section 80CCE

Section 80 CCD(2)

Tax Benefits for Self-Employed Individuals

Tax deduction up to 20% of gross income

Total limit of Rs. 1.50 lakh

Tax deduction up to Rs. 50,000

Section 80 CCD (1)

Section 80CCE

Section 80 CCD(1B)

Tax Advantages of Partial Withdrawal

Tax exemption on amounts withdrawn up to 25%

of self-contribution

Subject to PFRDA criteria

Section 10(12B)

Tax Benefit on Annuity Purchase

Tax exemption on annuity/superannuation

Section 80CCD(5)

purchase at the age of 60

Subsequent annuity income taxed under Section 80CCD(3)

Tax Advantages of Lump Sum Withdrawal

Tax exemption on 60% lump sum withdrawal

of accrued pension fund

Section 10 (60 or superannuation)

Corporate/Employer Tax Breaks

Tax deduction on employer contribution to NPS

Up to 10% of employee's pay (Basic + DA)

Section 36(1)(iv)(a)

as 'Business Cost'

Compiled by:

CS Manjeet S Dhillon

Manjeet S Dhillon & Associates

(Company Secretaries)
www.csmanjeetsdhillon.com
Email: csmanjeetdhillon25@gmail.com
Contact: 98153-11662

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