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NPS Calculator
Corpus at 60, the lump sum you can take, and the pension the annuity portion buys.
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The National Pension System accumulates until 60 and then splits: at least 40% has to buy an annuity, and the rest can be withdrawn tax-free.
The annuity is the catch
Annuity rates in India have been around 6% to 7%, below what the corpus was earning. The pension is taxable as salary in the year you receive it, while the lump sum is not. Taking the minimum 40% into annuity is usually the better arrangement unless you specifically want guaranteed income.
The tax deductions
₹50,000 under 80CCD(1B) sits on top of the ₹1.5 lakh under 80C. Separately, an employer's contribution under 80CCD(2) — up to 14% of basic — is deductible and, uniquely among retirement deductions, survives in the new regime.
Choosing the mix
The active choice lets you set equity up to 75% until 50, tapering after. The auto choice does the tapering for you. Over a 25-year horizon the equity share is the main determinant of the corpus.
Frequently asked questions
How much of the NPS corpus can I withdraw at 60?
Up to 60% as a tax-free lump sum. At least 40% has to buy an annuity, which provides a monthly pension taxable as salary. Where the total corpus is ₹5 lakh or less, the whole amount can be withdrawn.
What return should I assume?
It depends on the equity allocation. A corpus with 50% to 75% equity over 25 years has historically returned 9% to 11%. The auto choice reduces equity as you age, which lowers both the risk and the expected return.
What tax deduction does NPS give?
₹50,000 under 80CCD(1B) on top of the ₹1.5 lakh under 80C, both old regime only. Employer contributions under 80CCD(2) — up to 14% of basic for government and 10% for others — are deductible and survive in the new regime.
Is the annuity a good deal?
Annuity rates have run around 6% to 7%, below what the corpus was earning, and the income is fully taxable. Most people take the minimum 40% into annuity unless they specifically want guaranteed lifelong income.