PremiumEasing the National Pension System (NPS) withdrawal rules, the Pension Fund Regulatory and Development Authority (PFRDA) has allowed NPS account holders to withdraw entire accumulated pension fund if their accumulated wealth in NPS account is ₹5 lakh or below. The PFRDA made these changes under the PFRDA Amendment Act published in the Gazette of India.
The PFRDA Amendment Act published in the Gazette of India announced, ".... where the accumulated pension wealth in the Permanent Retirement Account of the subscriber is equal to or less than a sum of five lakh rupees, or a limit as specified by the Authority, the subscriber shall have the option to withdraw the entire accumulated pension wealth without purchasing annuity."
The PFRDA amendment also made it clear that in the case of NPS subscriber's death, if the accumulated wealth is equal to or less than ₹5 lakh, then the nominee or the legal heir (as the case may be) will have the option to withdraw 100 per cent NPS balance without buying annuity.
"Provided further that if the accumulated pension wealth in the permanent retirement account of the subscriber at the time of his death is equal to or less than Five lakh rupees or a limit to be specified by the Authority, the nominee or legal heir(s) as the case may be, shall have the option to withdraw the entire accumulated pension wealth without requiring to purchase any annuity and upon such exercise of this option the right of the family members to receive any pension or other amounts under the National Pension System shall extinguish," the PFRDA Amendment said.
The PFRDA also allows NPS subscribers to defer annuity purchase for three years as the amendment says, ".... subscriber shall have the option to defer the purchase of annuity for a maximum period of three years, from the date of attainment of sixty years of age or the age of superannuation, as the case may be, provided the subscriber intimates his or her intention to do so in writing in the specified form at least fifteen days before the attainment of age of sixty years or the age of superannuation, as the case may be, to the National Pension System Trust or any intermediary or other entity authorized by the authority for this purpose."
The PFRDA also allows NPS subscribers to defer annuity purchase for three years as the amendment says, ".... subscriber shall have the option to defer the purchase of annuity for a maximum period of three years, from the date of attainment of sixty years of age or the age of superannuation, as the case may be, provided the subscriber intimates his or her intention to do so in writing in the specified form at least fifteen days before the attainment of age of sixty years or the age of superannuation, as the case may be, to the National Pension System Trust or any intermediary or other entity authorized by the authority for this purpose."
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