{"id":11626,"date":"2019-07-09T11:14:02","date_gmt":"2019-07-09T05:44:02","guid":{"rendered":"https:\/\/www.apnaplan.com\/?p=11626"},"modified":"2020-06-19T14:03:24","modified_gmt":"2020-06-19T08:33:24","slug":"nps-tax-free","status":"publish","type":"post","link":"https:\/\/www.apnaplan.com\/nps-tax-free\/","title":{"rendered":"NPS Becomes more Attractive after Budget"},"content":{"rendered":"\n

Budget 2019 among many things also notified following 3 changes in NPS – which would make it more attractive to investors.\u00a0<\/p>\n

    \n
  1. NPS withdrawal becomes Tax free<\/li>\n
  2. NPS Tier II now under 80C (only for Central Govt employees)<\/li>\n
  3. Contribution increased in NPS to 14% for Government Employees<\/li>\n<\/ol>\n

    The post give details for all the above point.<\/p>\n

    NPS Withdrawal is Tax Free<\/h2>\n

    NPS until now was partially taxable at the time of withdrawal. Out of the entire NPS corpus, minimum 40% has to be used to buy annuity. This withdrawal was tax free but the amount received on annuity is taxable as per tax slab. Out of the remaining 60% – 40% was tax free while the 20% of NPS corpus was taxable.\u00a0<\/p>\n

    With the new notification in Budget 2019, the entire 60% lump-sum withdrawal is tax free.<\/strong> The union cabinet had approved of the above decision last year but has been notified only in the Finance Bill 2019.\u00a0<\/span><\/p>\n

    \n

    Also Read:<\/strong> NPS \u2013 Maturity, Partial Withdrawal & Early Exit Rules <\/a><\/p>\n<\/blockquote>\n

    Employer NPS Contribution increased to 14% for Government Employees<\/h2>\n

    The employer contribution for government employees in NPS has been increased to 14% of their (Basic Salary + Dearness Allowance). The good thing is this contribution tax exemption has too been hiked from 10% to 14% u\/s 80CCD(2) for government employees. However, the tax exemption limit remains 10% of salary for all others.<\/p>\n

    I think this is regressive policy to differentiate between government & non-government employees. It just complicates rules and also government employees make rules which does not impact them! \u00a0<\/p>\n

    \n

    Read: NPS Tax Benefit u\/s 80CCD(1), 80CCD(2) and 80CCD(1B)<\/a><\/p>\n<\/blockquote>\n

    \"NPS
    NPS – Changes in Budget 2019<\/strong><\/figcaption><\/figure>\n

    NPS Tier II now eligible for Tax Saving u\/s 80C<\/h2>\n

    Starting FY 2019-20, Central Government employees can invest in NPS Tier II account to save tax u\/s 80C. The lock-in period for the investment is 3 years. Other people\u2019s investment in NPS Tier II is still not eligible for 80C deduction.\u00a0<\/p>\n

    I do not see any specific reason as to why anyone should choose NPS Tier-II for tax saving investment given that there are multiple better options already available u\/s 80C<\/a>.\u00a0<\/p>\n

    To Conclude<\/h2>\n

    The long standing demand of making NPS tax free if finally here. This is good move and help people get some more on retirement.\u00a0<\/p>\n

    \u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"

    Budget 2019 among many things also notified following 3 changes in NPS – which would make it more attractive to investors.\u00a0<\/p>\n

    NPS withdrawal becomes Tax free
    \nNPS Tier II now under 80C (only for Central Govt employees)
    \nContribution increased in NPS to 14% for Government Employees<\/p>\n","protected":false},"author":1,"featured_media":11627,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_uag_custom_page_level_css":"","site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-gradient":""}},"footnotes":""},"categories":[480,3814,37,393,63,6],"tags":[2713,1585,2798],"uagb_featured_image_src":{"full":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2019\/07\/NPS-Changes-in-Budget-2019.png",1128,626,false],"thumbnail":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2019\/07\/NPS-Changes-in-Budget-2019-150x150.png",150,150,true],"medium":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2019\/07\/NPS-Changes-in-Budget-2019-300x166.png",300,166,true],"medium_large":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2019\/07\/NPS-Changes-in-Budget-2019-768x426.png",768,426,true],"large":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2019\/07\/NPS-Changes-in-Budget-2019-1024x568.png",1024,568,true],"1536x1536":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2019\/07\/NPS-Changes-in-Budget-2019.png",1128,626,false],"2048x2048":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2019\/07\/NPS-Changes-in-Budget-2019.png",1128,626,false],"yarpp-thumbnail":["https:\/\/www.apnaplan.com\/wp-content\/uploads\/2019\/07\/NPS-Changes-in-Budget-2019.png",120,67,false]},"uagb_author_info":{"display_name":"Amit","author_link":"https:\/\/www.apnaplan.com\/author\/admin\/"},"uagb_comment_info":1,"uagb_excerpt":"Budget 2019 among many things also notified following 3 changes in NPS - which would make it more attractive to investors.\u00a0 NPS withdrawal becomes Tax free NPS Tier II now under 80C (only for Central Govt employees) Contribution increased in NPS to 14% for Government Employees","_links":{"self":[{"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/posts\/11626"}],"collection":[{"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/comments?post=11626"}],"version-history":[{"count":0,"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/posts\/11626\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/media\/11627"}],"wp:attachment":[{"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/media?parent=11626"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/categories?post=11626"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.apnaplan.com\/wp-json\/wp\/v2\/tags?post=11626"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}