I opened an NPS account in 2022 at the age of 68. Made investment of 50,000 each in the last two years to avail tax benefits. I no more require this tax benefit. Now I have completed 70 years. Can I withdraw the entire amount with accruals and close the account.

Ans: "If you continue to invest in your NPS account, you will have no trouble withdrawing the accumulated funds when your age is 60. At age 60, you will be able to withdraw up to 60% of your corpus in a lump sum or in a graduated manner as per the recent amendment to NPS procedure. The remaining 40% must be used to purchase an annuity, which will provide you with a regular income stream for the rest of your life.
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Ans: At 42, you cannot withdraw the full amount from NPS.

You can only withdraw up to 20% before 60.

The remaining 80% must be used to purchase an annuity.

Consider staying in NPS for tax benefits.

For better returns, switch to aggressive funds within NPS.

Benefits of Staying in NPS

NPS offers tax benefits under Section 80C and 80CCD.

It provides disciplined retirement savings.

You can switch between fund managers.

NPS has low fund management charges.

Disadvantages of Index Funds

Index funds only track market indices.

They lack flexibility to outperform the market.

Actively managed funds seek higher returns.

Professional fund managers make strategic decisions.

Actively managed funds adapt to market changes.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ans: Since you have contributed to this scheme for more than 3 years, You can partially withdraw the amount, for some specific purpose.
Most welcome for any further clarifications. Thanks.

Ans: Your NPS Transfer from Superannuation: Key Points
You contributed to a Superannuation Scheme for many years through your company.

Last year, the company allowed one-time transfer of this corpus to NPS.

You opted in. But you retired before the transfer was processed.

Now, the superannuation money has landed in NPS, just 2 months ago.

You are now over 60 years and want to withdraw 60% lumpsum from NPS.

Basic Withdrawal Rule at Age 60 in NPS
Once you turn 60 years, you are allowed to withdraw up to 60% as lumpsum.

The remaining 40% must be used to buy annuity from an IRDA-approved insurer.

The withdrawal request must be made through CRA (Central Recordkeeping Agency) portal.

This withdrawal can be done even if contributions are only for a short period, like in your case.

Unique Situation in Your Case: Transfer After Retirement
Let’s examine a few things that make your case unique.

You had already retired before the NPS transfer was completed.

But the transfer itself was valid, and now the money is with NPS.

You are now a subscriber above 60 years with corpus already in Tier-I account.

This means you can initiate withdrawal as per NPS exit rules.

PFRDA Rules Allow This Withdrawal
As per the PFRDA guidelines, the following conditions apply:

Subscribers aged 60 or more can initiate exit anytime after retirement.

Minimum NPS contribution duration not mandatory for corporate-to-NPS transfers.

Since the transferred corpus is now inside NPS, you are treated as a retired subscriber.

You are eligible to withdraw 60% tax-free, and use 40% for annuity purchase.

Steps to Initiate Withdrawal from NPS
You can now begin the formal withdrawal process:

Login to https://cra-nsdl.com or https://enps.nsdl.com using PRAN.

Choose the “Exit from NPS” option.

Provide bank details, identity proof, and annuity option details.

Upload a cancelled cheque and photograph.

If help is needed, contact your PoP (Point of Presence) or nodal office.

You can also go through your former employer if they facilitated the NPS setup.

Tax Benefit on Withdrawal
The 60% you withdraw as lumpsum is completely tax-free.

The remaining 40%, when used to buy annuity, will be taxable as pension income.

The monthly pension received from annuity is added to your taxable income every year.

Caution on Annuity Choice
Choose annuity type wisely. Options include return of purchase price, joint annuity, etc.

Avoid choosing lowest premium. Focus on steady and safe pension.

You may compare annuity options on https://www.npstrust.org.in/annuity-service-providers.

Finally
Yes, you can withdraw 60% lumpsum from NPS even if it was a superannuation transfer.

Retirement before transfer is not a disqualification. The key is, money is now in NPS.

Follow the exit process and choose your annuity option with care.

Since this is a one-time decision, you may take help from a Certified Financial Planner.

Best Regards,
?
K. Ramalingam, MBA, CFP,
?
Chief Financial Planner,
?
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment