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FinCalc India

NPS Calculator

The National Pension System (NPS) is a market-linked retirement scheme regulated by PFRDA. You contribute during your working years; at 60 you can withdraw part as a tax-free lump sum and must use the rest to buy an annuity that pays a monthly pension.

Enter your age, monthly contribution and return assumptions to see the projected corpus and pension.

Assumptions used
  • Contributions at the start of each month, compounding monthly, constant return.
  • Annuity rate and the annuity share are user assumptions; actual figures depend on the plan chosen at exit.

Enter your details

years
1859
years
4075
₹
5005,00,000
%
415
%
310

Rate the annuity provider pays after retirement.

%
40100

At least 40% must buy an annuity at normal exit.

Results

Corpus at Retirement

₹1,13,96,627

Total Invested
₹18,00,000
Wealth Gain
₹95,96,627
Lump Sum (tax-free)
₹68,37,976
Amount for Annuity
₹45,58,651
Estimated Monthly Pension
₹22,793
  • Invested₹18.00 L(16%)
  • Wealth gain₹95.97 L(84%)

How the NPS projection works

Contributions are assumed to be invested at the start of each month and to compound monthly at the expected blended return of your equity and debt allocation:

Corpus = C × [ ((1 + i)^n − 1) ÷ i ] × (1 + i)

  • C = monthly contribution
  • i = expected annual return ÷ 1200
  • n = months to retirement

At exit, the corpus is split:

  1. A chosen share (minimum 40%) buys an annuity.
  2. The rest — up to 60% — is withdrawn as a tax-free lump sum.
  3. Monthly pension ≈ annuity amount × annuity rate ÷ 12.

NPS tax benefits

  • Employee contribution qualifies under Section 80CCD(1) within the overall 80C limit, plus an extra deduction under 80CCD(1B), under the old regime.
  • Employer contribution to NPS is deductible under 80CCD(2) in both regimes, subject to limits.
  • 60% lump sum at exit is tax-free; the annuity income is taxed at your slab rate in the year received.

At normal exit, up to 60% of the corpus can be withdrawn tax-free and at least 40% must be used to purchase an annuity. Returns and annuity rates are assumptions, not guarantees.

Returns are not guaranteed

NPS returns depend on market performance and your asset allocation. The annuity rate at exit depends on interest rates and the annuity provider you choose. Treat the projection as indicative.

Rates & rules: Rules as on 2025. Source: PFRDA exit & withdrawal regulations. At normal exit, up to 60% of the corpus can be withdrawn tax-free and at least 40% must be used to purchase an annuity. Returns and annuity rates are assumptions, not guarantees.

This calculator is for education and illustration only. Results are estimates based on the inputs and assumptions shown and are not financial, investment, tax or legal advice. Verify figures with your bank, a registered adviser or the relevant government department before acting.

Frequently asked questions

How much of the NPS corpus can I withdraw at 60?

Up to 60% as a tax-free lump sum. At least 40% must be used to purchase an annuity that pays you a monthly pension for life.

Is the NPS pension taxable?

Yes. The monthly annuity income is added to your total income and taxed at your slab rate in the year you receive it. The 60% lump sum is tax-free.

What return should I assume for NPS?

It depends on your equity-debt mix. A moderate assumption is around 9–11% for an equity-tilted allocation and lower for a conservative one. Returns are market-linked, not fixed.

Can I retire from NPS before 60?

Premature exit is allowed after a minimum period, but then a larger share (usually 80%) must buy an annuity and only the balance is paid as a lump sum, subject to a minimum-corpus rule.

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