How to invest in the National Pension System?

1. How to invest in the National Pension System? The National Pension System (NPS) is a popular investment scheme that allows you to create a corpus for your retirement and also receive lifelong incomes from the corpus created. The National Pension System was introduced by the Government to help individuals create a retirement corpus for themselves. The scheme gives market-linked returns on your investments so that the corpus that you accumulate is inflation-adjusted for better financial security. Besides allowing you to create a retirement corpus the National Pension System also gives you tax benefits. The money that you invest in the NPS scheme is allowed as a deduction from your taxable income under Section 80C of the Income Tax Act, 1960. You can avail a deduction of up to INR 1.5 lakhs. Moreover, you can also avail additional deductions under Section 80 CCD (1B) by investing in the National Pension System. Investment up to INR 50,000 is allowed as a deduction under the Section. Even the new tax regime allows deductions for NPS contributions where all other deductions are disallowed. If you are a salaried employee and your employer contributes up to 10% of your salary towards the NPS scheme, such contributions would be allowed as a deduction from your taxable income under the new tax rules if you choose the new tax slabs. This deduction is allowed under Section 80 CCD (2). Given the tax benefits offered by the National Pension System and an avenue to create a retirement corpus, it proves beneficial to invest in the scheme. Let’s understand how – How to invest in the National Pension System? Investment in the NPS scheme can be done through a bank that is registered with the scheme. Currently, almost all banks and financial institutions allow NPS investments and you can open an NPS account with any bank of your choice. Such financial institutions that are registered with the scheme are called Point of Presence (POP). Each POP then authorizes its branch to allow NPS investments from interested individuals. Such authorized branches are called Point of Presence Service Providers (POP-SPs). The list of banks and financial institutions which are registered with the NPS scheme to accept investments is available online at the website of Pension Fund Regulatory and Development Authority (PFRDA) and the link is ​https://www.npscra.nsdl.co.in/pop-sp.php​. How to invest in NPS online? You can also choose to invest in NPS online if you don’t want to visit the branch of the bank for making an investment. To invest in NPS online you can use the net banking facility offered by your bank and open an NPS account. Alternatively, you can visit the online website of NSDL and invest in NPS online. To do so, the steps are as follows – ● Visit ​https://enps.nsdl.com/eNPS/NationalPensionSystem.html​ and click on ‘National Pension System’ You would have to first register yourself before the account can be opened. To do so, click on ‘Registration’ on the pop-up window which opens A new page would open wherein you need to enter the relevant details. These details include the following – ● ●

2. o o o o Applicant type Status of the applicant (residential status) Registration is done with PAN Type of NPS Account you want to invest in You should then enter in your PAN card number and the bank which would act as your POP When the details are entered, click on ‘Continue’ to complete the registration Once you are registered, you can invest in NPS online ● ● ● Investment in the NPS account would also require you to provide your documents like the identity proof, age proof, address proof, and PAN Card. Your Aadhaar card might also be needed to link your account to your Aadhaar. NPS investments can be done easily online or offline. Since the scheme is a tax-saving scheme to accumulate a retirement corpus, ​invest in the National Pension System​, and make your retirement worry-free.