An individual is eligible to claim deduction of Rs. 50,000 under Section 80CCD(1B) of the Income-tax Act, 1961 (“the Act”). This is over and above the Rs 1.5 lakh deduction available under Section 80C of the Act in a financial year. Please note that assessee’s can avail the facility of opening NPS account who are in the age limit of 18 to 70 years.
 
The procedure for opening a NPS account is given below:
 

1. Visit site https://enps.nsdl.com/eN P S/National Pension System.
 

2. CIick on ‘National Pension Scheme’.
 
3. Click on ‘Registration’.
 

4. FiII the basic particulars along with ‘tier’ details. There are two types of tiers:
a) Tier l: Withdrawal not allowed before 60 years of age – No tax on withdrawals.
b) Tier II: Withdrawal allowed before 60 years of age – Withdrawals are taxable. 60% withdrawals can be taken in cash after 60 years of age. Balance 40% will be given in the form of pension.
 

5. Register with Aadhar Number (Linked with Phone number) along with PAN.
 

6. Kindly fill in Personal Details and Family Details.
 

7. Click on “Generate acknowledgement No.” Tab.
 

8. Click on “0K” on the acknowledgement number page.
 

9. Kindly fill in Residential Status and address, PAN (tax identification number), permanent address and correspondence address.
 

10. Click on “Save and Proceed” and fill the bank account details and income range

How to National Pension Scheme (NPS) Account?
 
11. 0n the Scheme and Nomination details, select the Fund Manager from the list as per your choice and select the investment option from Auto or Active.
i) Automatic Investment (Auto): Choose from 3 options:
a) Aggressive Life Cycle (High Risk)
b) Moderate Life Cycle (Moderate Risk)
c) Conservative Life Cycle (Low Risk)
ii) Active: You can choose the proportion upto maximum exposure determined
Maximum Exposure Equity 75%
Corporate Bond 100%
Govt Securities 100%
Alternative Investment 5%
 

Suppose we are making investment of Rs 1,00,000. in NPS and choose active option then as per the limits provided. We can apply maximum up to Rs, 75,000/- i.e. 75% in Equity and balance in corporate bonds or govt securities as per your choice and preference. The cap on equity investment is based on the age Of the person making investment in NPS,
In Automatic Investment route the proportion of investment in any of the fund selected is based on age of the investor.
 

12. Fill in the nominee details along with 100% share and click on “Save and Proceed”.
 

13. Upload scanned PAN and Cancelled cheque in .jpg, .jpeg, .pdf formats with maximum size limit of 2MB per attachment.
 

14. Click on “Confirm” after uploading the documents.
 

15. Check all the pages once again with the details filled in and provide the amounts in the “Payment Details” tab in the Tier I or Tier II option with minimum investment Of RS, 500 in Tier I and RS- 1,000 in Tier II and click on “Confirm Payment”.
 

16. Select the payment option and select the option to obtain “Annual Transaction Statement” along with “PRAN card options”.
(PRAN card is the identification card in respect of unique NPS number allotted to the investor.)
 

17. Click on “Confirm” and make the Payment.
 

18. Note the PRAN Number allotted and authenticate with “OTP authenticate / E- sign Registration.”
 

19. Put in the Captcha Code and Generate OTP. Fill in the OTP received on E mail & Phone.
 

20. Click “Verify OTP” and then click on the “Click Here” option to download the Form of NPS for record.
 

21. Now you can log in from PRAN/IPIN but before that Investor has to click on Password Reset option to set a password.
 

22.For password generation click on “set/reset your PIN” option available just below the “Login with PRAN/IPIN” option.
 

23, Feed the PRAN number, Date of Birth, password (TO be made) and generate OT p. Enter OTP received on Phone and click on “Submit”.