NPS calculator

What the National Pension System is

The National Pension System is a defined-contribution retirement scheme run under the Pension Fund Regulatory and Development Authority. A subscriber chooses a pension fund manager and an asset mix across equity, corporate bonds, government securities and alternative assets; the corpus grows at the pension fund's returns. At exit, the corpus is split between a lump sum, an annuity purchase and, for mid-size balances, systematic unit redemption. The annuity provider then pays a monthly pension. The calculator takes an assumed annual return as an input and prints the full build-up at that single number.

Normal exit for a non-government subscriber means 15 years in the National Pension System, or age 60, or superannuation; the subscriber may defer the lump sum and the annuity purchase to age 85. A government subscriber exits at superannuation. An exit before either of those sets is called premature; the full-withdrawal limit for a premature exit is ₹5 lakh of accumulated wealth and at least 80 per cent otherwise goes to annuity.

The 2025 PFRDA amendment, in plain English

The PFRDA (Exits and Withdrawals under NPS) Amendment Regulations 2025, gazette dated 12 December 2025, set three slabs at normal exit for both government and non-government subscribers. On an accumulated wealth up to ₹8 lakh, the whole amount may be withdrawn as a lump sum or periodic payouts, with no annuity required. Above ₹8 lakh and up to ₹12 lakh, up to ₹6 lakh can come out as lump sum and the balance runs through systematic unit redemption for at least six years, an annuity or another PFRDA-approved option. Above ₹12 lakh, the minimum annuity share is 20 per cent for a non-government subscriber and 40 per cent for a government subscriber; the balance is available as lump sum.

The amendment also raised the deferral age for a non-government subscriber to 85, and the five-year lock-in that applied earlier was removed in several cases. The calculator shows which of the three bands applies to the projected corpus and prints the lump sum and the monthly pension at the annuity share the reader enters, subject to the minimums.

Worked example you can check

Take a monthly contribution of ₹5,000, rising 10 per cent each year, from age 30 to 60 at an assumed 10 per cent annual return. Each year the instalment is held still for 12 months and then stepped up for the next year. The arithmetic treats every instalment as paid at the start of the month, consistent with the SIP page on this site.

The corpus at age 60 is about ₹3.21 crore, well past the ₹12 lakh band, so the normal 20 per cent minimum annuity share for a non-government subscriber applies. At a 40 per cent annuity share, ₹1.28 crore buys the annuity and ₹1.93 crore is the lump sum. On an assumed annuity rate of 6 per cent a year, the monthly pension works out to about ₹64,197. A 20 per cent annuity share on the same corpus pays about ₹32,100 a month, with ₹2.57 crore as lump sum.

How the assumed return moves the answer

Equity and bond returns move from year to year, and so does the corpus a given contribution reaches. Holding the monthly contribution at ₹5,000, the yearly step-up at 10 per cent and the term at 30 years, changing only the assumed return gives the following.

A single assumed-return path is not what an NPS portfolio delivers. The honest use of this page is to run the same inputs at a lower and a higher rate and keep both in mind, rather than reporting one result as the answer.

Tax on NPS: contribution and exit

Deduction on the subscriber's own contribution, under the earlier section 80CCD(1) within the ₹1,50,000 aggregate and the additional ₹50,000 under the earlier section 80CCD(1B), is available only under the old regime. Deduction on the employer's contribution, under the earlier section 80CCD(2), is available under both regimes: 14 per cent of basic plus DA for a private employee under the new regime from 1 April 2025, 10 per cent of basic plus DA under the old regime, and 14 per cent for a government employee under both regimes.

At normal exit, up to 60 per cent of the corpus withdrawn as lump sum is tax-free under the provision earlier known as section 10(12A); the remainder of the corpus goes into the annuity, which is itself not taxed at purchase. For a non-government subscriber who takes more than 60 per cent of the corpus as lump sum, the tax treatment of the slice above the 60 per cent band needs checking against the gazette or with a qualified chartered accountant. Monthly pension received from the annuity is taxed at slab under both regimes.

Annuity purchase: the second decision

Once the annuity share is decided, the subscriber picks an annuity provider from the PFRDA-empanelled list and an annuity option (life only, joint-life, with return of purchase price and so on). The payout rate depends on the provider, the option and the subscriber's age at purchase. This page takes a single annuity rate as an editable input and applies it to the annuity amount.

The monthly pension on the calculator is therefore an arithmetic estimate at the rate you enter. It is not a quote, not a forecast, and not a claim on any annuity provider's product; the actual payout depends on the quote the chosen provider gives on the date of purchase. Compare the same arithmetic at a 5 per cent, 6 per cent and 7 per cent annuity rate to see how sensitive the pension is.

What this calculator leaves out

• Fund management charges and PFRDA charges inside NPS, which run at a few basis points of corpus a year.
• A return path that changes from year to year, including different equity-debt mixes under PFRDA's life-cycle choices.
• Tier II, a voluntary and more liquid account that runs alongside Tier I and does not attract the same tax benefits.
• The PFRDA empanelment and quote for the chosen annuity option; the monthly pension is an estimate at the rate you enter.
• Any premature-exit split for a reader who does not meet normal-exit conditions; the result above is the normal-exit arithmetic.

Frequently asked questions

Courses that teach the subject behind the national Pension Scheme calculator