Under the NPS introduced under the New Pension Policy, the Department of Posts allows its customers to open accounts. Till now, one had to go to the branch of the postal department for this, but from April 26, this facility has started getting online as well. Now you can open NPS account sitting at home.
New Delhi. Indian Postal Department has started another great service for its customers. The department said that now customers will be able to open NPS account sitting at home. The Department of Posts said in an official statement that NPS membership has started from April 26, 2022 through online mode, customers can open their account sitting at home.
According to the statement, any citizen of the country above 18 years and below 70 years of age can apply for this facility by visiting the online category of National Pension System (NPS) on the official website of the Department of Posts. The department has also claimed that its NPS service fee is the lowest compared to any bank or institution. Under this facility, customers are given the option of services like new registration, investment or SIP.
The government had implemented NPS only under the New Pension Scheme and since 2010, the Pension Fund Regulatory and Development Authority (PFRDA) manages the accounts to be opened through the Department of Posts.
There are two types of accounts
Under NPS, two types of accounts can be opened by the customer. In this, Tier-1 account which is only for employees. Both the employer and the employee contribute to this account. The second is Tier-2 account which can be opened by anyone. Tax exemption is also given under section 80C of Income Tax on investments up to Rs 1.5 lakh annually in Tier-1 account. At the same time, tax exemption of 50 thousand is available annually on Tier-2 account. Overall, you get the benefit of tax exemption up to Rs 2 lakh every year on an NPS account.
How NPS Account Works
If you are employed and you and your employer are contributing under NPS, then this amount will be managed by the pension regulator, but many private fund houses have also been authorized to run it. These fund houses invest your money in government securities, mutual funds and the stock market. So far, the average annual return on NPS account is more than 10 percent.
This is how benefits are available on retirement
When an NPS account holder retires, 60 per cent of the total deposit amount (including interest) is paid in lump sum. This amount is completely tax free. After this, he has to buy an annuity with 40 percent amount which any insurance company can provide. Now only the interest received on this amount is available in the form of pension every month.
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