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NPS Calculator — Calculations & Slabs for FY 2026-27

Enter your age, monthly contribution, and expected return to project your NPS Tier-I corpus at 60 and the estimated monthly annuity based on a 6% annuity rate.

1. Investment Variables

Minimum 40% mandatory reinvestment required at age 60.

NPS Tax Exemptions

NPS is a highly tax-efficient tool. Over and above the standard ₹1.5L limit under Section 80C, you can claim an additional ₹50,000 deduction under Section 80CCD(1B). At age 60, the 60% lumpsum is tax-free.

Common Questions & Calculator Insights

What is the National Pension System (NPS) and how does it work?

NPS is a voluntary retirement savings scheme designed to provide social security after retirement in India. You contribute periodically to your Tier-1 account, which is managed by professional pension fund managers investing in equity and debt. The corpus compounds until you turn 60.

Can I withdraw my entire NPS corpus at the age of 60?

It depends on your corpus size and subscriber category. As per PFRDA rules revised in December 2025: if your total corpus is ₹8 lakh or less, you can withdraw 100% as a lump sum. For non-government subscribers with a corpus above ₹12 lakh, you can withdraw up to 80% as a tax-free lump sum and must use the remaining 20% to purchase an annuity from an IRDAI-approved life insurer. Government sector employees continue to follow.

What is the mandatory annuity purchase rule in NPS?

As per PFRDA's December 2025 revision: if your total corpus at retirement is ₹8 lakh or less, the annuity rule is fully waived and you can withdraw 100%. For non-government subscribers with corpus between ₹8 lakh and ₹12 lakh, you may take up to ₹6 lakh as a lump sum and use the balance for an annuity or Systematic Unit Redemption (SUR). For corpus above ₹12 lakh, non-government subscribers must allocate a minimum of 20%.

Is NPS eligible for additional tax benefits under the Income Tax Act?

Yes, NPS offers unique tax breaks. Contributions up to ₹1.5 lakh qualify for tax deductions under Section 80CCD(1). Furthermore, under Section 80CCD(1B), you can claim an additional tax deduction of up to ₹50,000 per financial year over and above the ₹1.5 lakh limit.

Where can I verify the source data for this calculator?

You can verify the values against the official notifications listed in our data sources section at the bottom of the page.

Rates sourced from official government portals — see data sources & verification dates

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About This Calculator

Target Audience: Salaried taxpayers, investors & retirees planning Indian tax & wealth growth Last verified: 2026-06-30

What Does This Calculator Do?

This tool helps you estimate how much money you will have when you retire using the government pension plan. It also calculates the monthly pension payment you will receive. It helps you plan a worry-free retirement with regular lifelong income. It is the perfect tool to secure your future years.

How to Use It

  1. Monthly Contribution: Type the money you want to invest into the pension fund every month.
  2. Expected Return Rate: Type the yearly growth percentage you expect from your pension fund.
  3. Your Current Age: Type your current age in years. The investment stops when you reach 60.
  4. Expected Annuity Rate: Type the annual interest rate you expect to earn on your pension scheme.
  5. Annuity Reinvestment: Type the percentage of your retirement money used to buy the monthly pension plan.

The Logic Explained Simply

  • The Concept: Think of this as a two-stage rocket. Stage one is the savings stage, where you put in money monthly, and it compounds until you turn 60. Stage two is the payout stage. At age 60, you withdraw a tax-free chunk of cash, and the rest is locked in a secure account that pays you a steady monthly salary for the rest of your life.
  • The Formula:

Total Corpus = Accumulation of monthly deposits compounded at the return rate until age 60.

Monthly Pension = (Total Corpus × Annuity Reinvestment % × Annuity Rate %) / 12

Real-World Calculation Breakdown

For example, if you are 30 years old and invest ₹10,000 monthly with a return rate of 10% until age 60. Over 30 years, you accumulate ₹2,27,93,902. If you reinvest 40% into a pension plan at an interest rate of 6%, you get ₹1,36,76,341 as tax-free cash. The remaining ₹91,17,561 buys a lifelong pension, paying you ₹45,588 every single month.

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