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- NPS New Rules 2025: Withdraw Full Corpus Up To ₹8 Lakh, Exit Age Extended To 85, Non Govt Users Get 80% Lump Sum
New Delhi2 minutes ago
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The Pension Fund Regulatory and Development Authority (PFRDA) has made major changes in the exit and withdrawal rules of the National Pension System (NPS). According to the updated rules, if the total deposit in NPS is Rs 8 lakh or less, then you can withdraw your entire money. Earlier this limit was Rs 5 lakh.
At the same time, for non-government employees, it is necessary to invest only 20% of the deposit in buying annuity, earlier it was 40%. That means now they can withdraw up to 80% lumpsum.
If the deposit is more than Rs 12 lakh, then 20% can be withdrawn as annuity and the remaining in lumpsum or staggered (in pieces). If the deposit is between Rs 8 to 12 lakh, then up to Rs 6 lakh can be withdrawn in lump sum and the rest through systematic withdrawal option.
The new rules will make it easier for small investors to meet their cash needs at retirement and employees will get more options at retirement. The government issued a notification on December 16 giving this information.
What changed for government employees?
The rule of annuity for government employees is the same as before, that is, at least 40% of the large corpus (deposit) has to be invested in annuity. But on small deposits (up to Rs 8 lakh), the limit for withdrawing the entire amount in lump sum has been increased. On corpus of Rs 8-12 lakh, employees will be able to withdraw up to Rs 6 lakh as lump sum and the remaining as systematic payout or annuity.
Entry and exit age now up to 85 years
Earlier the age for complete exit from NPS was 75 years, now it has been increased to 85 years. Employees can keep the account active even after retirement, buy more or less lump sum or annuity. Due to this, the benefit of market returns will continue for a long time. Non-government users can take exit anytime between 60 to 85 years.
New option of systematic withdrawal
The option of Systematic Unit Redemption (SUR) has been added in the new rules. Instead of withdrawing the entire amount at once, employees can withdraw it gradually, for a minimum period of 6 years. This will help in tax planning and cash flow management.
What were the rules before?
Earlier, 40% annuity was mandatory in non-government, but even in government, there were strict rules on large corpus. On small corpus the limit was low and the exit age was also limited. PFRDA has tried to make NPS more attractive with these changes, so that people choose it for retirement savings.
What will be the impact going forward?
These changes will give the subscribers the freedom to use the money as per their need. Small investors will get full cash, big investors will get more lump sum. But reduction in annuity may affect long term pension income. Experts say that with this, more people will join NPS and retirement planning will be easier.
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Also read this news related to the new change…
Now you will be able to withdraw complete money from EPF account: There will be no need to submit documents, EPFO has simplified the rules.
Now full money can be withdrawn from EPF account. EPFO announced this in the Central Board of Trustees (CBT) meeting held on October 13. Many relief decisions were taken in the meeting chaired by Central Labor Minister Mansukh Mandaviya. With these decisions, it will now become easier than ever for employed people to withdraw money from their EPF.
Click here to read the full news…
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