Showing posts with label NPS. Show all posts
Showing posts with label NPS. Show all posts
Forms, Learning Materials & Guidelines Related to New Pension Scheme - DOP
Friday, October 20, 2017
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NPS:
Employees who joined before 01-01-2004 can also open a New Pension Scheme Account.
Download forms related to New Pension scheme here.
Forms:
1. Contribution Paying Slip NCIS - Download
2. PRAN Registration Form - Download
3. Subscriber Registration Form - Download
4. Grievance Registration Form - Download
5. Withdrawal Form for Tier-II- Download
Learning Materials:
1. Investment Guidelines - Download
2. Revised Operating Guidelines - Download
3. Offer Document Tyre-II - Download
4. Subscriber Offer Document. - Download
Power Point Presentations:
1. NPS PPTX - Download
2. New Pension System ppt - Download
Different forms and learning materials related to New Pension scheme can be downloaded from the links given below. It contains useful guides for understanding the New Pension Scheme which are mandatory for central Government employees who joined the Department on or after 01/01/2004. Now as per GOI rules, any citizen of India can join the New Pension Scheme.
Employees who joined before 01-01-2004 can also open a New Pension Scheme Account.
Forms:
1. Contribution Paying Slip NCIS - Download
2. PRAN Registration Form - Download
3. Subscriber Registration Form - Download
4. Grievance Registration Form - Download
5. Withdrawal Form for Tier-II- Download
Learning Materials:
1. Investment Guidelines - Download
2. Revised Operating Guidelines - Download
3. Offer Document Tyre-II - Download
4. Subscriber Offer Document. - Download
Power Point Presentations:
1. NPS PPTX - Download
2. New Pension System ppt - Download
New Pension Scheme (NPS) for railway employees not workable - AIRF
Monday, October 16, 2017
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The market-linked pension scheme would
have 10 per cent contributory fund by Government and 10 per cent by the
employees. In this, Government knows the money is being used, but the
employee does not have any information regarding the use of its funds,
said AIRF General Secretary, Shivagopal Mishra
The Government of India, in its different departments, has recruited over 5 lakh employees since 2004, including one lakh employees in the Indian Railways. The new officials and employees, recruited under the new pension scheme are not finding the new scheme workable.
The market-linked pension scheme would have 10 per cent contributory fund by Government and 10 per cent by the employees. In this, Government knows the money is being used, but the employee does not have any information regarding the use of its funds, said AIRF General Secretary, Shivagopal Mishra while addressing the press conference on Tuesday at the West Central Railway Employees’ Union (WCREU) office. He is in city to attend the Youth Zonal Conference of WCREU.
He added that the new pension scheme has various lapses. First, it is market-linked and has limited provisions for withdrawal. Its provision is against employee’s benefits
that is benefits provisions would end if the service is not complete. On this issue, when the AIRF gave a notice of strike to the Government, the present Government constituted a committee to review the demands of AIRF. “We are demanding guarantee pension scheme for the employees that is 50 per cent of last salary. On death or permanent disability of the employee, the compensation should be given as per old scheme. On this, the Government has shown some positive response, while also, the committee constituted has given recommendations in this direction, asking the Government to accept this demand,” he said.
He further said that, every year, around 400 to 500 employees die on duty. In these incidents, a number of linemen and trackmen lose their lives. We are demanding that like the Indian Army has been exempted from the new scheme, the Indian Railways employees and officials should be exempted from the new pension scheme provisions.
Commenting on the outsourcing trending in Railways, Mishra strongly criticized the ongoing outsourcing and said that outsourcing of important works in Railways would not be tolerated. We are demand the Government to fill all 1.25 lakh vacancies in safety and security departments, as without manpower of Railways, proper instrumentation and equipment, the security of Railways is not possible, he added.
After recent incidents, the Government
has ordered to fill all vacancies in Railways and now, following
pressure, now again the decision is being reviewed. He lastly added that
if Railways does not have any option for privatisation of every work,
the AIRF would have no other option left, but to go on strike. He said,
Railways is the lifeline of country’s economy. If we go on strike, it
would add fuel to the ongoing impact of recession in the country.
source: the hitavada com
I) On Contributions:
Employee’s own Contribution- Eligible for tax deduction under sec 80 CCD (1) of Income Tax Act up to 10% of salary (Basic + DA) within the overall ceiling of Rs. 1.50 Lacs under Sec. 80 C of the Income Tax Act.
From F.Y. 2015-16, subscriber will be allowed tax deduction in addition to the deduction allowed under Sec. 80CCD(1) for contribution in his NPS account subject to maximum of Rs. 50,000/- under sec. 80CCD ) .
Employer’s contribution: Up to 10% of Basic & DA (no upper monetary ceiling) under 80CCD(2). This rebate is over and above 80 C. (This tax benefit is only available for NPS subscribers).
II) Partial Withdrawal– Tax free
III) Lump sum Withdrawal– In case of superannuation, 40% of lump sum withdrawal is tax free.
IV) Annuity– Amount utilized for purchase of annuity is not taxable in the hands of the subscriber.
source: FNPO.ORG
Under this scheme, subscribers invest in a fund chosen by them and at the time of retirement they get a lump sum amount depending on the performance of that fund. The returns from NPS are not guaranteed; they are market-linked. NPS was introduced in 2004 for the new government employees but from 2009, it was extended to all on a voluntary basis.
Here is your 10-point cheat-sheet
1) Tax savings: The extra deduction of Rs. 50,000 on NPS can help those in the highest tax bracket of 30 per cent save an additional Rs. 16,000 in taxes. Those in 20 per cent tax bracket can save over Rs. 10,000 while those in 10 per cent can save over Rs. 5,000.
2) More tax-saving options: This extra deduction of Rs. 50,000 on NPS will increase the total deduction allowed under Section 80C and 80CCD of Income Tax Act to Rs. 2 lakh, says Mayur Shah, executive tax director at EY. The combined limit earlier was Rs. 1.5 lakh. Section 80C relates to deduction allowed under investments in instruments like PPF and insurance policies. Section 80CCD represents deduction with respect to a pension plan notified by the government, including NPS. The limit on deduction on 80CCD, including contribution to the New Pension Scheme, was also increased in the Budget to Rs. 1.5 lakh from Rs. 1 lakh. This will help investors have more tax-saving options.
3) Other Budget proposal: The Finance Minister also said that the government is planning to give an option to employees to opt out of Employees Provident Fund (EPF) and instead invest in NPS for retirement savings.
4) Tax on withdrawal: Mr Jaitley however did not extend tax breaks on withdrawal from NPS. So contribution to NPS up to Rs. 1.5 lakh and the interest earned are not taxed but the withdrawal becomes taxable. Other savings schemes such as public provident fund (PPF) and employee provident fund (EPF), however, enjoy tax benefits in all the three stages: contribution, interest earned and withdrawal.
5) NPS structure: The scheme is structured into two tiers: Tier-I and Tier II accounts. The Tier-I account is the non-withdrawable account meant for savings for retirement. The contribution to Tier-I account is only eligible for tax benefits.
Tier-II account is a voluntary withdrawable account which can be opened only when there is an active Tier I account in the name of the subscriber. The withdrawals are permitted from this account as per the needs of the subscriber. The Tier-II account is more like a bank savings account.
6) Withdrawal options: Subscribers can exit from NPS upon attaining the age of 60 (for all subscribers other than government employees). At least 40 per cent of the accumulated pension wealth of the subscriber needs to be mandatorily used for purchase of an annuity for the monthly pension of the subscriber and the balance is paid as a lump sum payment to the subscriber. Annuity service providers are responsible for delivering a regular monthly pension to the subscriber after exit from the NPS.
Subscribers can exit from NPS even before attaining the age of 60 by using at least 80 per cent of the accumulated pension wealth for purchase of an annuity for providing for the monthly pension. The balance is paid as a lump sum payment to the subscriber.
7) Fund options: NPS offers a range of investment options and choice of pension fund manager who will manage subscribers' funds. Individuals also have an option to switch over from one investment option to another or from one fund manager to another. The returns are, however, totally market-linked. Investors have the option for choosing stocks, government bonds and other securities as their asset choice. But the equity part of the allocation cannot exceed 50 per cent.
8) Minimum deposit: For Tier-I account, Rs. 6,000 has to be deposited by the subscriber in a year and the minimum contribution is Rs. 500 at one time.
9) Portability: After opening an NPS account, a subscriber gets a Permanent Retirement Account Number (PRAN), which is a unique number and remains with the subscriber throughout his/her lifetime. NPS provides portability across jobs and across locations.
10) Opening and tracking of account: Many banks are registered with Pension Fund Regulatory and Development Authority (PFRDA) to provide NPA-related services to individuals. NPS account can be opened to anyone from 18 years to 60 years of age. All transactions as well as the current fund value can be tracked online.
The NPS is more complicated than
EPF, but it may ensure a sufficient retirement kitty
If there’s one investment option
that has received generous tax breaks in the Budget, it is the National Pension
System (NPS). In a watershed move, the Finance Minister has also announced that
employees in the organised sector will now be able to opt out of contributions
to the Employees Provident Fund (EPF) and invest in the NPS instead. So, if
given this choice, what should you do? Here’s how they compare.
Contributions
EPF contributions are mandatory for
employees earning up to ₹15,000 a month in the organized sector. Many employers however
insist on EPF contributions for all their employees. The contribution is pegged
at 12 per cent of your pay (basic plus dearness allowance). Your statutory EPF
contributions are matched by your employer. If you are an employee who usually
struggles to save, the EPF is a good option for you as it forces you to save at
least 12 per cent of your pay.
But if you are targeting a
comfortable retirement, note that EPF alone won’t be enough as it is pegged
only to your basic pay. The NPS is a voluntary account; you can contribute
anything starting from ₹500 a month (₹6,000 a year).
To avail of the tax breaks on the
investment, the maximum limit is ₹2 lakh a year. Unlike the EPF, the NPS allows you to skip
contributions for a few months if you can’t afford it (investing once a year is
mandatory).
So, the NPS scores over the EPF on
two counts — you can save much more and do it with greater flexibility. But
currently all your EPF contributions are matched by your employer. Not so for
the NPS.
Portfolio
The money you pay into EPF is
invested in ultra-safe options — Central and State Government securities, bonds
and deposits from PSUs and a special deposit scheme from the Government. Last
we know, G-Secs made up 40 per cent of the portfolio, PSU debt 32 per cent,
with the deposit making up the rest of the EPF kitty. The EPF doesn’t actively
manage its portfolio — it mostly buys and holds till maturity. This makes for
low but predictable returns.
The key differentiator with the NPS
is that it allows you to add an equity component to your retirement kitty. You
also get to flexibly allocate your money between equities (up to 50 per cent),
liquid funds/bonds and Government Securities (G-Sec) in any proportion you
like.
You also have the choice of
deciding who, among the six pension fund managers, will manage your money.
Their individual track records are available on their websites.
You can rejig allocations once a
year and also change your fund manager. Both the equity and the debt portions of
the NPS have delivered double-digit returns in the last one year. But because
they are invested in market instruments, your returns will fluctuate from year
to year.
The G-Sec portion, for instance,
delivered negative returns during the rising rate scenario, but is faring well
with falling rates. Given that you are looking at the NPS as a long-term
option, you need not worry too much about shorter term losses in the debt
portfolio. Due to its portfolio structure, the NPS is likely to earn higher
returns but with greater variability.
Returns
The interest you earn on your EPF
account is decided by the EPF trustees who announce the rate every year. In the
last four years, interest rates have been 9.5, 8.25, 8.5 and 8.75 per cent,
respectively.
The returns on NPS depend on your
asset allocation as well as choice of fund manager. If you choose a 30-50 per
cent equity component, returns are likely to be in the double-digits, even
assuming equities manage only 15 per cent a year and debt securities 8 per
cent.
Disclosures
The EPF’s portfolio is not made
public. But it is a government-backed scheme and the presumption is that it
will not default on any payments. Returns are also announced and
well-publicised.
With the NPS, you know exactly
where it invests, with all the managers regularly disclosing their portfolios.
But unlike the EPF, gauging NPS returns is not easy. Returns earned by
different plans/managers are not available at one location. You need to compile
them individually from the historical NAVs put out by the different fund
managers.
So, the EPS is your best bet if you
like to know exactly what you’re earning. The NPS works if you don’t mind
leaving it to market forces.
Liquidity
The EPF allows you to withdraw your
money before retirement if you resign from one job and take up another, after a
gap. You can also draw money from it for constructing/buying a home, illness,
marriage or education of children. You can use the sums withdrawn for these
purposes.
In the NPS, if you withdraw before
the age of 60, you need to compulsorily use 80 per cent of the proceeds to buy
an annuity plan from an insurer. Even withdrawals after the age of 60 require
you to use 40 per cent to buy an annuity. Only 60 per cent will be available to
you to deploy as you please.
The EPF is certainly more flexible
than NPS on early withdrawals. But withdrawing too much or too often can leave
you short of a retirement kitty when you most need it.
Taxability
Contributions to the EPF are
tax-free under Section 80C. Interest earned and withdrawals aren’t taxed
either, unless you do so within five years of starting the account.
Investments in the NPS, up to ₹2
lakh are tax-free. But the sums you withdraw at retirement are taxable at the
prevailing income tax rates.
source: thehindu.com
A defined contribution pension scheme under the New Pension Scheme (NPS) for Central government employees,
who have joined service after April 1, 2004, is compulsory. It went
operational in 2008-09. The NPS structure implemented in India is very
investor friendly. The investment options offer adequate flexibility. A
subscriber can invest into government security (up to 100 per cent) or
corporate bonds (up to 100 per cent) and equity up to 50 per cent (only
Nifty or Sensex). The Pension Fund Regulatory and Development Authority ( PFRDA)
regularly monitors the performance to prevent risky investments. The
process for withdrawal on retirement at 60 years of age is
‘market-proof’ as it gives the option to withdraw in lump sum or on
deferred basis over 10 years. The total cost of administration of the
pension account from the subscriber’s perspective is among the cheapest
in the world. But these virtues are largely unknown to the public.
Since 2009, over three million pension accounts have been opened with
total accumulated pension wealth of around Rs 21,000 crore. Out of
this, the pension wealth accumulated under the voluntary scheme is less
than Rs 150 crore (about 60,000 accounts) vis-a-vis pension wealth of
government employees of Rs 20,850 crore. Clearly, policy initiatives are
required for encouraging voluntary subscription.
PFRDA appointed the Committee to Review Implementation of Informal Sector Pension ( CRIISP)
to review the implementation of NPS. The committee identified that
under the unbundled structure, no intermediary owns up the
responsibility for marketing. While the committee examined the role of
all intermediaries in the structure, it did not examine the role of
government as a stake holder. As the pension wealth accumulation grows,
government can seek funds from pension funds for infrastructure
development and social sector planned expenditure. The success of NPS
will partially relieve the government’s social security burden.
There is also a need to raise the awareness about the tax benefits of
the scheme for employers, HR professionals and employees to motivate
them to participate in it.
PFRDA introduced the ‘NPS for corporates’ scheme under which the
corporate is the nodal point to offer NPS facility and will be
responsible for collection of subscriptions as part of salary
administration. The Income Tax Act
allows 100 per cent of employer’s contribution to employees’ pension
fund under NPS subject to a maximum of 10 per cent of salary of
employees. A mere reallocation from the ‘cost to the company’ towards
contribution to the pension scheme helps employees get substantial tax
benefits plus systematic retirement savings.
The pension wealth accumulated under NPS will be available for
withdrawal only at the age of 60 years, unlike other types of long-term
savings. The government may create tax incentives around this USP of
assured accumulation of pension wealth and attract them towards
systematic pension savings. There is a need for offering exclusive
additional deduction besides the current 80 CC options to encourage wage earners to participate in the NPS.
An awareness campaign on old-age financial security and NPS needs to
be taken up, as today’s demographic dividend will become a demographic
burden 20 years later
Source: business-standard.com
writer: V R Narasimhan
How to get Details of New Pension Scheme Account through SMS & Email ?
Thursday, March 3, 2011
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Terms and Conditions for SMS and E-Mail facility
A NPS subscriber has to specify his mobile number and e-mail ID in the subscriber registration form for getting the information through SMS or email.
Currently there is no fee for getting this facility.
Details are given below:
In these Terms and Conditions, the following terms shall have the following meanings:
Alert/Facility
Means the (services of providing the ) customized messages with respect to specific events/transactions relating to a subscriber’s Account sent as Short Messaging Service (“SMS”) over Mobile phone or email to the email account of the subscriber;
Subscriber
Means the person who holds a permanent Retirement Account Number (PRAN) opened by CRA and who is also IRA compliant;
CSP
Means the cellular service provider through whom the investor receives the mobile services.
CRA
Means NSDL who have been appointed as Central Recordkeeping Agency by PFRDA.
Availability of the Service
- CRA at its sole discretion may discontinue the facility at any time by providing a prior intimation through its website or any other medium of communication. CRA may at its discretion extend the facility to investors who register mobile numbers originating outside India.
- The Facility would be generated by CRA and will be sent to the subscriber on the mobile number or E-mail Address provided by the subscriber. Further, the time and the completeness of the Alerts content and delivery would be entirely based on the service availability of the service provider and its connectivity with other CSPs or the mail server availability of the respective websites. The Alerts are dependent on various factors including connectivity and therefore, CRA cannot assure final and timely delivery of the Alerts.
- The Subscriber will be responsible for the security and confidentiality of his/her Mobile Phone/email account to be used for this Facility.
Process
- This Facility provides information to investors over mobile phones and email ids for PRAN getting generated and the units getting allocated in Tier I and Tier II of the account, a day after the units get credited. These Alerts will be sent to those subscribers who have provided their mobile numbers and /or email ids to their nodal offices (like PAOs/DTOs/POPs etc.) while filling a PRAN application form.
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The Subscriber is duty bound to acquaint himself/herself with the detailed process for using the facility and interpreting the Alerts for which NSDL is not responsible for any error/omissions by the subscriber. -
The subscriber acknowledges that this facility will be implemented in a phased manner and CRA may at later stages or when feasible, add more features. CRA may, at its discretion, from time to time change the features of any Alert. The subscriber will be solely responsible for keeping himself/ herself updated of the available Alerts, which shall, on best-effort basis, be notified by CRA through its website or any other medium of communication.
Receiving NPS information through SMS and Emil
- The subscriber is solely responsible for intimating in writing to his/ her nodal office/POP any change in his /her mobile phone number and /or email id. CRA will send the alerts only to the numbers/email id recorded in it system.
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The subscriber acknowledges that to receive Alerts, his/her mobile phone must be in an ‘on’ mode(reachable) as well as well as the email id must be ‘active’. If his/her mobile is kept ‘off’ for a specific period from the time of delivery of an Alert by CRA or the email account is no more in active State , that particular information may not be received by the subscriber. -
The subscriber acknowledges that the facility is dependent on the infrastructure, connectivity and services provided by the CSPs /or the e-mail service provider within India. The subscriber accepts that timeliness, accuracy and readability of information sent by CRA will depend on factors affecting the CSPs and other service providers. CRA shall not be held liable for non-delivery or delayed delivery of Alerts, error, loss or distortion in transmission of information to the subscriber. - CRA will endeavor to provide the facility on a best effort basis and the subscriber shall not hold CRA responsible/liable for non-availability of the facility or non performance by any CSPs or other service providers or any loss or damage caused to the subscriber as a result of use of the facility (including relaying on the information for his/her investment or business or any other purposes) for causes which are attributable to / and are beyond the control of CRA. CRA shall not be held liable in any manner to the subscriber in connection with the use of the facility.
- The subscriber accepts that each Alert may contain certain account information relating to the subscriber. The subscriber authorizes CRA to send any other account related information, though not specifically requested, if CRA deems that the same is relevant.
Withdrawal or Termination
-
CRA may, in its discretion, withdraw temporarily or terminate the facility, either wholly or in part, at any time. CRA may suspend temporarily the facility at any time during which any maintenance work or repair is required to be carried out or incase of any emergency or for security reasons, which require the temporary suspension of the facility. - Notwithstanding the terms laid down in clause above, either the investor or CRA may, for any reason whatsoever, terminate this facility at any time. In case the subscriber wishes to terminate this facility, he/she will have to intimate his/her PAO/DTO/POP accordingly.
Fees
At present, CRA is levying no charge for this facility on the subscriber/PAO/DTO/POP. The subscriber shall be liable for payment of airtime or other charges, which may be levied by the CSPs in connection with the receiving of the information. As per the terms and conditions between the CSPs and subscriber, and CRA is in no way concerned with the same.
Disclaimer
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This Facility is only additional information for the investors and is not in lieu of the Transaction statement required to be provided by the CRA to its clients on a yearly basis. - CRA shall be not be concerned with any dispute that may arise between the investor and his/her CSP and makes no representation or gives no warranty with respect to the quality of the service provided by the CSP or guarantee for timely delivery or accuracy of the contents of each Alerts.
- The Subscriber shall verify the transactions and the balances in his/her account from his/her nodal office and not rely solely on Alerts for any purpose.
- CRA will not be liable for any delay or inability of CRA to send the Alert or for loss of any information in the Alerts in transmission.
Liability
CRA shall not be liable for any looses, claims and damages arising from negligence, fraud, collusion or violation of the terms here in on the part of the investor and/or a third party.
