Corporate NPS

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What is Corporate NPS?

Corporate NPS is designed for all organizations including Private Companies, PSUs, CPSEs, etc.

Benefits to Employer

  • Corporate NPS helps employers to gain the goodwill of their employees over and above their PF’s contribution.
  • Enables employees to build their retirement corpus by becoming a co-contributor to their pension.
  • No administrative cost and hassle-free record-keeping.

Rolling out the Corporate NPS program in your organisation

  • Corporate can join NPS through any one of the existing Point of Presence (POP).
  • Employees in the organized sector who work for a company registered under Corporate NPS are eligible to join Corporate NPS.
  • It is a voluntary contribution plan in which the employer makes periodic payments to the employee's NPS account on their behalf.
  • Employees in both the public and private sectors can join NPS through the corporate method.

Tax Benefits to Employees

  • Employee (Self) Contribution Tax Benefit: Tax deduction benefit of up to 10% of salary (Basic + Dearness Allowance) can be availed u/s 80 CCD (2) up to Rs. 1.5 lakh limit in a fiscal under Section 80 CCE of the Income Tax Act, 1961.
  • Employer Contribution Tax Benefit: Employer contributions under tax old regime to NPS Tier 1 account up to 10% of the employee’s salary (Basic + Dearness Allowance) under the corporate NPS qualifies for an additional tax deduction. Under new tax regime employer contribution has been increased to 14% of Basic + Dearness Allowance.
  • Employee (Self) Contribution Tax Benefit under Section 80 CCD (1B): In addition to the tax benefits of corporate NPS contribution discussed above, Tier 1 accounts can claim an additional deduction of up to Rs. 50,000 under Section 80 CCD (1B).

How to join Corporate NPS?

Joining NPS is made very easy and by following 3 simple steps you can start your retirement planning:

  • Click here to fill in your personal details.
  • Upload your PAN, Copy of your signature and cancelled cheque.
  • Make online investment and your PRAN is created.

Frequently Asked Questions on Corporate NPS?

Here are some frequently asked questions about Corporate NPS

Eligibility & Regulatory Framework

Yes, any registered corporate entity — private, public, or NGO — can offer Corporate NPS to its employees. The company needs to register with a Point of Presence (PoP) like DSP Pension under PFRDA guidelines.

Any Indian citizen between 18–85 years of age employed with a registered corporate can enroll in Corporate NPS. The employer must be registered with PFRDA as a corporate entity through a PoP.

Yes, Corporate NPS is fully regulated by the Pension Fund Regulatory and Development Authority (PFRDA), ensuring transparency, safety, and accountability. All fund managers, PoPs, and transactions operate strictly under PFRDA's framework.

Employer Contributions and Tax Benefits

Yes, employers can claim a tax deduction on contributions up to 10% to 14% of the employee's Basic + DA basis the tax regime as a business expense under Section 36(1)(iv)(a). This reduces the company's taxable profit directly.-

Employers can contribute up to 10% of Basic + DA (eligible for tax deduction), while employees can contribute any amount as per their choice. There is no upper cap on total contributions from either side.

Corporate NPS acts as an additional retirement benefit that enhances the overall CTC and financial security of employees. It demonstrates long-term employer commitment, boosting loyalty and reducing attrition.

Investment Management & Withdrawal

Yes, employees can switch between fund managers and asset classes (Equity, Corporate Bonds, G-Sec) up to twice a year. They can also choose between Active Choice (self-managed) and Auto Choice (age-based allocation).

Partial withdrawal of up to 25% of own contributions is allowed after 3 years for specific purposes like medical emergency, child's education, or home purchase. Premature exit requires 80% of the corpus to be used for annuity purchase.