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About the NPS Calculator
The National Pension System is a market-linked retirement account with the lowest fund management charges available anywhere in India. You contribute until sixty, choose an equity–debt mix, and at retirement withdraw up to 60% tax free while at least 40% must buy an annuity that pays a monthly pension.
Its tax treatment is the strongest argument for it: an extra ₹50,000 deduction under 80CCD(1B) beyond the 80C ceiling, and an employer contribution under 80CCD(2) that survives even in the new regime.
The formula
The lump sum you withdraw at 60 is tax free; the annuity income is taxed as salary.
Things worth knowing
Frequently asked questions
It depends on the corpus, the share annuitised and the annuity rate on offer. A ₹1 crore corpus with 40% annuitised at 6% pays roughly ₹20,000 a month, with ₹60 lakh withdrawn tax free.
Up to ₹1.5 lakh under 80C, an additional ₹50,000 under 80CCD(1B), and the employer contribution up to 14% of salary under 80CCD(2) — the last of which is available even under the new regime.
Partial withdrawals of up to 25% of your own contributions are allowed after three years for specified purposes. Full exit before 60 requires 80% of the corpus to be annuitised.
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