Pension fund regulator PFRDA has suggested an increase in the monthly pension limit under Atal Pension Yojana (APY). It has also pitched for an increase in age limit to join the pension scheme to 60 years, from the current limit of 40. Atal Pension Yojana is a government scheme pension scheme meant employees of the unorganised sector employees as well as self employed. It is open for those between 18 and 40 years .
“We have been asking for increasing the age limit for subscription under Atal Pension Yojana (APY) from 40 to 60 years. And also to increase the pension limit from existing ₹5,000 a month to ₹10,000 per month under APY,” PFRDA Whole Time Member Supratim Bandyopadhyay told news agency Press Trust of India.
Pension Fund Regulatory and Development Authority of India (PFRDA), which administers National Pension System (NPS), also regulates Atal Pension Yojana.
Under the Atal Pension Yojana, guaranteed minimum pension of ₹1,000 or ₹2,000 or ₹3,000 or ₹4,000 or ₹5,000 per month will be given at the age of 60 years, depending on the contributions by the subscribers.
The benefit of minimum pension under Atal Pension Yojana is guaranteed by the government if the actual realised returns on the pension contributions are less than the assumed returns for minimum guaranteed pension. Shortfall, if any, will be funded by the government.
In case of premature death of subscriber (death before 60 years of age), spouse of the subscriber is given an option to continue contributing to Atal Pension Yojana account of the subscriber till the original subscriber would have attained the age 60 years.
On the other hand, if the actual returns on the pension contributions are higher than the assumed returns for minimum guaranteed pension, over the period of contribution, such excess shall be credited to the subscriber’s account, resulting in enhanced scheme benefits to the subscribers.
The PFRDA has also urged the government to increase the income tax deduction limit to ₹1 lakh for investment in Tier I NPS account under Section 80CCD (1B) of the Income Tax Act. It has also also urged the government to extend the facility of of tax free contribution of 14% by the central government to its employees under the NPS to all categories of subscribers.