How to exit from NPS scheme?

From what I know, earlier, the age restriction for leaving the NPS was 60 years. However, this provision has been changed. Now NPS members may leave at the retirement age set by their companies. My firm chooses to have their employees retire at 58 years old. Keep reading to know about the NPS exit rules.

What are the NPS exit rules?

1) After retirement or a regular exit

Regular exit is when you as an NPS member reach age 60 or retire from full-time work. It can be in accordance with your job conditions as a salaried NPS member, this is considered a normal exit. You can withdraw up to 60% of the collected capital money all at once. Annuities must be purchased with a balance of 40% of the fund. If you choose to leave, you may have the following choices:

• To keep working and making contributions to the NPS after reaching retirement age. It can be up to 70 years old or 10 years from the time of retirement, whichever comes first.

• To keep holding NPS investments without providing any additional contributions. It can be for a further 70 years or 10 years from the date of retirement, whichever comes first.

• Delaying the purchasing of an annuity for a maximum of 3 years after reaching 60.

• To postpone taking the lump sum out and keep investing in NPS until you are 70 years old.

How to exit the NPS scheme?

You can terminate your NPS account at any time if you don't want to keep it active or postpone your withdrawal. Read about the process for the same here:

• Use your User ID (PRAN) and Password to access the CRA system below.

• Select "Exit from NPS" from the menu, then select the "Initiate Withdrawal Request" button.

• Enter the essential information, including the ASP and annuity plan you want to use to get your pension.

• You must print the system-generated Withdrawal Form, attach a photo and sign next to the photo and against the declaration. You have to do it following the submission of the information.

• Then submit the form along with the necessary KYC documents to the appropriate nodal office.

This is all about the NPS exit rules.