What Is The Full Form Of NPS In Income Tax?
NPS full form in income tax is National Pension Scheme. It’s a program supported by the government of India to help people save money for their old age. The National Pension Scheme was started to ensure every citizen of India has a structurally sound savings plan for their golden years. It encourages people to save a little money while working at their places of employment. After one has retired from his or her place of work, one can take out part of the money that has been saved and use it for a one-time need while the rest can be used to take an annuity regularly every month in the form of income.
How to Join NPS:
Anyone who wants to join NPS can do so through several Points of Presence (POPs), which include banks and online platforms like the eNPS portal. You will need to provide some of the documents, like your PAN, and details of your bank account. You will also have to make some sort of initial payment to be able to open your NPS account.
Rules and Benefits of NPS:
You need to keep adding money to your NPS account until you are 60. When you retire, you can take out up to 60% of your savings without paying tax on it. The remaining money must be used to buy an annuity that will pay out a fixed income to you regularly. NPS also has the advantage of tax under Sections 80C, 80CCD(1), 80CCD(1B), and 80CCD(2) of the Income Tax Act, which makes it a good option for saving.