NPS Withdrawal Rules: A Complete Guide for 2025

The National Pension System (NPS) is a long-term retirement savings plan, but knowing its withdrawal rules is just as important as investing.

Many subscribers ask:

• Can I withdraw money before retirement?
• How much tax will I pay on withdrawals?
• What is the process for online NPS withdrawal?

In this guide, we explain all NPS withdrawal rules for 2025, including partial withdrawals, premature exit, full withdrawal on retirement, and tax implications.

Looking for expert guidance? Plan your NPS withdrawal with HDFC Pension today!

Types of NPS Withdrawals

1. Partial Withdrawal from NPS

• Allowed after 3 years of account opening
• Max withdrawal: Up to 25% of own contributions
• Permitted only for specific reasons:

• Higher education or marriage of children
• Medical emergencies
• Home purchase or business setup

Need a partial withdrawal? Apply online with HDFC Pension.

2. Premature Exit from NPS (Before 60 Years)

If you want to withdraw before retirement, here are the rules:

• Condition: You must have been an NPS subscriber for at least 10 years.
• Withdrawal limit:

• 40% must be used to buy an annuity (regular pension)
• 60% can be withdrawn as a lump sum (taxable)

Thinking of exiting NPS early? Know your options with HDFC Pension.

3. Full Withdrawal on Retirement (After 60 Years)

Upon retirement, the withdrawal rules change:

• 60% of the corpus can be withdrawn as a lump sum (tax-free)
• 40% must be used to buy an annuity (taxable pension income)

Tip: If your total corpus is less than ₹5 lakh, you can withdraw 100% without annuity purchase.

Maximize your retirement savings! Plan your NPS maturity withdrawals with HDFC Pension.

How to Withdraw NPS Funds Online

Step-by-Step Process

1. Login to the NPS portal (www.cra-nsdl.com)
2. Go to Withdrawal Requests in the subscriber dashboard
3. Choose withdrawal type (Partial, Premature Exit, or Full Withdrawal)
4. Upload necessary documents (ID proof, bank details, purpose verification for partial withdrawal)
5. Submit and track your request online

Need assistance? Get expert help from HDFC Pension.

Taxation on NPS Withdrawals

1. Partial Withdrawals

• Tax-free under specified conditions

2. Premature Exit Tax Rules

• 40% used for annuity purchase – Tax-free
• 60% lump sum withdrawal – Taxable as per income slab

3. Retirement Withdrawal Tax Rules

• 60% lump sum withdrawal – Completely tax-free
• 40% annuity – Taxable as per your income slab

Want a tax-efficient withdrawal strategy? Consult HDFC Pension experts now.

Best Strategies for Tax-Efficient NPS Withdrawal

• Plan withdrawals in a lower tax bracket year
• Spread out withdrawals over multiple years to reduce tax burden
• Select an annuity plan with tax benefits
• Invest the lump sum amount wisely for additional tax savings

Maximize your tax benefits! Get NPS tax-saving strategies from HDFC Pension.

Conclusion

Knowing NPS withdrawal rules is crucial for smart financial planning.

Key Takeaways:

• Partial withdrawals allowed after 3 years for specific reasons.
• Premature exit requires at least 10 years of subscription.
• Retirement withdrawal offers tax-free benefits on 60% of the corpus.
• Tax planning can help minimize liability on withdrawals.

Plan your withdrawals wisely! Manage your NPS with HDFC Pension today.

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