How to use the NPS calculator
- Enter how much you will put into NPS each month, your age and the age you will exit (usually 60).
- Set the expected return. Equity-heavy NPS funds have returned about 9–12% a year over long periods; government-bond-heavy choices less.
- Choose the annuity share – the part of your corpus that must buy a pension – and the annuity rate insurers pay (about 6–7% a year today).
What happens when you exit NPS
At 60 you split the corpus in two. One part buys an annuity from an insurer, which pays you a monthly pension for life. The rest you can take as a lump sum.
- Non-government subscribers (all citizens and corporate NPS): since December 2025 at least 20% must buy an annuity, so up to 80% can be taken as a lump sum.
- Government employees: at least 40% must buy an annuity.
- Small corpora have simpler rules – check the current PFRDA exit rules before you exit.
\text{Pension a month} = \dfrac{\text{Corpus} \times \text{annuity share} \times \text{annuity rate}}{12}You invest ₹18,00,000 and the corpus grows to about ₹1,13,96,627. With 40% in an annuity at 6%, the pension is about ₹22,793 a month, and the lump sum about ₹68,37,976.
Tax benefits
Under the old regime, NPS contributions count towards Section 80C, and an extra ₹50,000 is deductible under 80CCD(1B). Under both regimes, your employer’s contribution (up to 14% of basic + DA in the new regime) is deductible – see the income tax calculator.
Frequently asked questions
How much pension will I get from NPS?
It depends on the corpus, the share you use for an annuity and the annuity rate. For example, a ₹1 crore corpus with 40% in an annuity at 6% pays ₹20,000 a month.
How much can I withdraw from NPS at 60?
Non-government subscribers can take up to 80% as a lump sum and must use at least 20% to buy an annuity. Government employees can take up to 60%.
What return does NPS give?
It is market-linked. Over the long run, equity schemes have returned roughly 9–12% a year and government-bond schemes about 8–9%, but past returns are not guaranteed.
Is the NPS lump sum tax-free?
Up to 60% of the corpus withdrawn at retirement is tax-free. The pension from the annuity is taxed as income each year.
Is NPS better than PPF?
NPS can earn more because part of it is in shares, but it is locked until 60 and part must buy an annuity. PPF has a guaranteed, tax-free rate and a 15-year term – compare with the PPF calculator.