New Pension Scheme: The central government approved the Unified Pension Scheme on Saturday. With the approval of this decision of the Union Cabinet, the years-old demand of lakhs of employees seems to be fulfilled.
Under UPS, retired employees will receive 50 per cent of their last salary as a pension. The new pension system will be implemented on April 1, 2025. Information and Broadcasting Minister Ashwini Vaishnaw explained the decision and said the New Pension Scheme will continue. Employees will be free to choose any of these two pension schemes. Today, we will tell you about these two pension schemes.
Know What Will Be Special In The Unified Pension Scheme
The Narendra Modi government at the Center has provided assured pensions in UPS.
Assured Pension: Under this, employees who have worked for 25 years will receive 50 per cent of the average basic pay of the last 12 months of their service as a pension.
Family Pension: If the employee dies on the job, 60 per cent of his basic pay will be given to his family as a family pension.
Minimum Pension: UPS has also arranged a minimum pension of Rs 10,000 for people who have completed 10 years of service.
Indexation Benefit: Under the new rules, indexation benefits will also be available in pensions, minimum, and family pensions.
Gratuity: After completing every six months of service, 1/10th of the salary and dearness allowance will be added to the gratuity. This payment will not reduce the amount of assured pension.
Know What Is New Pension Scheme or National Pension System
The National Pension Scheme, also known as the New Pension Scheme, was established in 2004 and opened to the private sector in 2009.
The Pension Fund Regulatory and Development Authority (PFRDA) manages NPS.
In this, you get a pension based on investment.
After withdrawing a small amount at retirement, you can take the remaining amount as monthly income. This ensures that you continue to receive an amount every month, even after retirement.
NPS is divided into Tier 1 and Tier 2 accounts. Those who choose a Tier 1 account can withdraw some amount only at retirement. However, Tier 2 account holders can withdraw some money before retirement.
According to Section 80 CCD of the Income Tax Act, one also benefits from tax exemption on investments up to Rs 1.5 lakh. Also, there is no tax on withdrawing 60 per cent of the NPS amount.
