Is NPS lump sum withdrawal taxable at retirement?

No, under current income tax regulations, the 60% lump sum withdrawal at age 60 is 100% tax-free. The remaining 40% used to purchase an annuity is also not taxed at exit, but the periodic annuity pension payments received thereafter are taxed as normal income.

What extra tax deduction does NPS offer?

NPS offers an exclusive deduction of up to ₹50,000 under Section 80CCD(1B), which is over and above the ₹1.5 lakh limit of Section 80C.

NPS Calculator

NPS Investment Details

Monthly Investment

₹

Your Current Age

Yrs

Retirement Age

Yrs

Expected Return Rate

Lumpsum Withdrawal (60%)

Percentage of corpus you want to withdraw at retirement (max 60%).

Expected Annuity Rate

NPS Retirement Projection

Total Corpus at Retirement

₹0

Total Invested

₹0

Total Returns

₹0

Post-Retirement Funds

Lumpsum Amount₹0

Annuity Corpus₹0

Expected Monthly Pension₹0

Guide & Methodology

About the National Pension System (NPS) Calculator

Estimate your retirement pension wealth, tax-free lump sum withdrawal (60%), and monthly pension annuity (40%) under the National Pension System.

What this calculator does

Calculates total retirement corpus built up to age 60 under NPS Tier-I.
Computes the mandatory 40% minimum annuity purchase for monthly pension.
Calculates the 60% tax-free lump sum payout upon retirement.
Incorporates additional tax deductions under Section 80CCD(1B) up to ₹50,000.

How it Works & Key Inputs

Step 1

Current Age & Retirement Age

Set your present age and desired retirement age (typically 60 years).

Step 2

Monthly Contribution

Specify monthly contribution towards NPS Tier-I account.

Step 3

Expected Return Rates

Input expected portfolio return (equity + debt mix, typically 9-11%) and expected annuity interest rate (typically 6-7%).

Core Calculation Parameters

Monthly InvestmentAmount invested every month in your PRAN account.

Annuity Share (%)Percentage allocated to buy annuity (minimum 40% mandatory).

Expected CAGRBlended return from equity (E), corporate debt (C), and government bonds (G).

Formula & Calculation Logic

Mathematical Model

Total Corpus = FV(SIP), Lump Sum = Corpus × 60%, Monthly Pension = (Corpus × 40% × Annuity Rate) / 12

Retirement corpus projection with standard PFRDA exit distribution.

Variables Breakdown

CorpusTotal accumulated wealth at age 60

Annuity %Portion used to purchase life pension (min 40%)

Annuity RateAnnual payout percentage offered by Life Insurance Annuity Service Providers

Frequently Asked Questions (FAQ)

Disclaimer: This calculator is provided for educational and illustrative purposes only. Actual financial outcomes may vary based on statutory changes, lender terms, fund fees, and prevailing market dynamics.