Posted by: Girija Gadre, Arti Bhargava and Labdhi Mehta on Mar 27, 2017, 06.30 AM IST
Under the National Pension System, a subscriber can create a retirement corpus and also enjoy tax benefits up to Rs 1.5 lakh under Section 80C and additionally up to Rs.50,000 under Section 80CCD(1B) of the Income Tax Act.
It is now possible to move funds from a recognized Employees Provident Fund (EPF) to the National Pension System (NPS).
Active NPS account As a prerequisite, one should have an active Tier 1 account with the NPS. This account can be opened through the employer, if NPS has been implemented already. Alternatively, one can approach a POP (point of presence) or can access the e-NPS portal to open a NPS account at npstrust.org.in.
Request for transfer of PF To make the transfer, a request must be made to the recognized employee provident fund or superannuation fund through the person’s current employer to transfer the balances in the EPF or superannuation fund account to his NPS account.
Transfer initiation Once the application is received, the recognised provident/superannuation fund will initiate the transfer of balances in the PF/superannuation account. A cheque or draft is issued in the name of the nodal office of NPS (in case of government employees) or in the name of the POP collection account (in case of all citizens model).
Issue of letter to employer A letter is issued by the recognised provident/superannuation fund to the employer that the amount is being transferred to the NPS Tier 1 account of the employee. The nodal office or POP (as the case may be) will get the amount collected and updated in the NPS Tier 1 account of the employee.