National Pension Scheme Tier II- Tax Saver Scheme, 2020


Quick Summary
The National Pension Scheme Tier II Tax Saver Scheme, 2020, has been introduced by the Central Government. This scheme allows Central Government employees to make contributions to a specified account, which has a lock-in period of three years. The minimum contribution to activate the account is one thousand rupees, with subsequent contributions of at least two hundred and fifty rupees.

MINISTRY OF FINANCE

(Department of Revenue)

(CENTRAL BOARD OF DIRECT TAXES)

NOTIFICATION

New Delhi, the 7th July, 2020

S.O. 2232(E).—In exercise of the powers conferred by clause (xxv) of sub-section (2) of section 80C of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby makes the following scheme, namely:—

1. Short title and commencement.-(1) This scheme may be called the National Pension Scheme Tier II- Tax Saver Scheme, 2020. (2) It shall come into force from the date of its publication in the Official Gazettee.

2. Definitions. - (1) In this scheme, unless the context otherwise requires,—

(a) "Act" means the Income-tax Act, 1961 (43 of 1961);

(b) “authority” means the Pension Fund Regulatory and Development Authority established under sub-section (1) of section 3 of the Pension Fund Regulatory and Development Authority Act,2013 (23 of 2013);

(c) "investment" means contribution in an specified account by the Central Government employee in accordance with the scheme;

(2) The words and expressions used herein and not defined but defined in the Act shall have the same meaning as respectively, assigned to them in the Act.

3. Investment.- (i) The assessee, being a Central Government employee, shall make contribution to the specified account which has been activated by the authority in accordance with the provisions of this scheme read with the operational guidelines, if any, issued by the authority in this regard on or after the date of commencement of this scheme.

(ii) The minimum amount of contribution to activate the specified account shall be one thousand rupees and minimum amount of subsequent contribution shall be two hundred and fifty rupees.

4. Lock- in-period.-The contribution made under this scheme shall have a lock in period of three years from the date of credit of amount to the specified account.

5. Transferability.-The contribution made to the specified account shall not be permitted to be assigned, pledged or hypothecated during the lock-in-period.

[Notification No. 45 /2020/F. No.370142/26/2019-TPL]

GUDRUN NEHAR, Director Tax Policy and Legislation)

FAQ :

It is a scheme introduced by the Central Government allowing Central Government employees to contribute to a specified account for tax savings.

The scheme is for Central Government employees who make contributions to a specified account activated by the authority.

The minimum amount to activate the specified account is one thousand rupees, and subsequent contributions must be at least two hundred and fifty rupees.

Contributions made under this scheme have a lock-in period of three years from the date the amount is credited to the specified account.

No, contributions made to the specified account cannot be assigned, pledged, or hypothecated during the lock-in period.

 

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