NPS Calculator
Calculate your NPS corpus at retirement, tax-free lump sum, and estimated monthly pension.
NPS calculator shows your projected corpus at retirement under the National Pension System. Enter your monthly contribution and current age. The tool computes total corpus at 60, the tax-free 60% lump sum, and an estimated monthly pension. Assumes a default 10% annual return and 6% annuity rate, both adjustable. Free, no signup required.
NPS Corpus at 60
₹1.14 Cr
after 30 yr at 10% p.a.
At Retirement
Lump Sum (60%)
₹68.38 L
Tax-free
Monthly Pension
₹22,793
Annuity corpus: ₹45.59 L
Returns are estimates based on inputs. NPS returns vary with market performance. Minimum 40% of corpus must be used to purchase an annuity. Lump sum withdrawal is tax-free.
Frequently Asked Questions
- What is NPS and how does it work?
- NPS (National Pension System) is a government-backed retirement savings scheme in India. You contribute monthly during your working years. At age 60, you can withdraw 60% of the corpus tax-free as a lump sum. The remaining 40% must be used to buy an annuity that pays a monthly pension for life.
- How much should I invest in NPS per month?
- The minimum monthly contribution is Rs 500 for Tier I accounts. For meaningful retirement savings, financial planners suggest 10 to 15% of your monthly income. Use this NPS calculator to find the corpus different monthly amounts would generate by age 60.
- What is the expected return on NPS?
- NPS returns depend on the asset allocation between equity (E), corporate bonds (C), and government securities (G). Equity-heavy portfolios (75% equity for age under 50) have historically returned 10 to 12% annually. Conservative allocations return 7 to 9%. The calculator defaults to 10%, which you can adjust.
- Is NPS tax-free on withdrawal?
- 60% of the NPS corpus at maturity is tax-free under Section 10(12A). The remaining 40% used to purchase an annuity is also exempt at the time of annuity purchase. However, the monthly pension received from the annuity is taxable as income.
- What is an annuity in NPS?
- An annuity is a financial product you buy with 40% of your NPS corpus at retirement. The annuity provider (a PFRDA-empanelled insurance company) pays you a fixed monthly income for life. The monthly amount depends on the annuity rate offered at the time of purchase, typically 5 to 7% annually.
- Can I withdraw NPS before 60?
- Partial withdrawal is allowed after 3 years for specific purposes like higher education, marriage, home purchase, or medical treatment. Early exit before 60 requires using 80% of the corpus for an annuity. Only 20% can be withdrawn as a lump sum.
What is NPS?
NPS stands for National Pension System, a government-regulated retirement savings scheme open to all Indian citizens aged 18 to 70. It was launched in 2004 for central government employees and opened to all citizens in 2009. The Pension Fund Regulatory and Development Authority (PFRDA) oversees it.
You contribute to a Tier I NPS account throughout your working years. At age 60, you receive 60% of the accumulated corpus as a tax-free lump sum. The remaining 40% must be used to purchase an annuity that pays a monthly pension for life.
How the NPS calculator works
Enter your current age, monthly contribution, expected annual return, and annuity rate. The calculator compounds contributions monthly using: FV = P × [((1 + r)^n - 1) / r]. Here P is the monthly amount, r is the monthly rate, and n is months until age 60.
The corpus at 60 is split: 60% as a lump sum and 40% as the annuity purchase amount. The estimated monthly pension multiplies the annuity amount by the annual rate, then divides by 12.
NPS tax benefits
NPS offers three layers of tax deduction. Under Section 80CCD(1), contributions up to 10% of basic salary fall within the Rs 1.5 lakh limit of Section 80C. Self-employed individuals can deduct up to 20% of gross income. Under Section 80CCD(1B), an additional Rs 50,000 deduction is available exclusively for NPS. Under Section 80CCD(2), employer NPS contributions up to 10% of basic plus DA are fully deductible with no upper ceiling.
At maturity, 60% of the corpus is tax-free under Section 10(12A). The annuity purchased with the remaining 40% is also exempt at purchase. Monthly pension received from the annuity is taxable as per your income slab.
NPS vs EPF vs PPF
- EPF is mandatory for salaried employees. NPS is voluntary and available to everyone including self-employed professionals.
- PPF offers a fixed 7.1% rate with full tax-free maturity. NPS returns are market-linked and potentially higher, but not guaranteed.
- NPS gives the additional Rs 50,000 deduction under 80CCD(1B) that EPF and PPF cannot match.
- NPS mandates 40% annuity at maturity. EPF and PPF allow full lump sum withdrawal.
- For maximum tax saving beyond Rs 1.5 lakh, NPS is the only instrument that provides the extra deduction.
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