Monthly Rs 5,000 Pension With Income Tax Benefits: Know Details About this Govt Scheme

Monthly Rs 5,000 Pension With Income Tax Benefits: Know Details About this Govt Scheme


Atal Pension Yojana: The finance ministry has recently notified that as many as 65 lakh registrations have been completed under the Atal Pension Yojana of the government during this fiscal so far. This has taken the total number of registrations under the pension scheme to 3.68 crore over the past six and a half years, the government added. Giving out the news, the Pension Regulatory and Development Authority (PFRDA) expressed hope that the number this year will cross the one crore mark if people continue to register to the scheme at this pace by March 31. The Atal Pension Yojana, or APY, is a government-backed social security scheme for senior citizens.

Atal Pension Yojana, the flagship social security scheme of the Government of India, was launched on May 9, 2015, to provide old-age income security particularly to the citizen in the unorganised sectors. It gives a pension of Rs 1,000 to Rs 5,000 to subscribers, upon reaching the retirement age of 60, depending on the proportion of the contributions made by them.

“The journey of the Atal Pension Yojana (APY) over six-and-a-half years since its inception has been substantive with 3.68 crore enrolments. The performance in this financial year has been good as more than 65 lakh subscribers enrolled which is the highest ever enrolment during the same period since the launch of the scheme,” said the government in a statement on Wednesday.

PFRDA chairman Supratim Bandyopadhyay said, “In addition to achieving one crore enrolment during this current financial year, going forward, we have the task of achieving pension saturation in the country and we shall continuously undertake proactive initiatives for achieving it.”

“This feat of bringing in the most vulnerable sections of society under the coverage of pension was possible only with the untiring efforts of public and private banks, regional rural banks, payments banks, small finance banks, co-operative banks, Department of Posts and the support extended by the state level bankers’ committees,”  he also said.

What are the Key Features of Atal Pension Yojana (APY)?

The Atal Pension Yojana is becoming increasingly popular among the masses years after its launch in May 2015. The key features of Atal Pension Yojana are:

a) Anyone between ages 18 to 40 can enroll to this scheme to get benefits after the retirement age. A guaranteed pension of up to Rs 5,000 per month will be provided by the government, based on the subscriber’s contributions made over the years. The scheme is open to all bank account holders.

b) The monthly pension of Rs 1,000 to Rs 5,000 would be available to the subscriber till the time he or she is alive. After his or her death, the pension will go to his or her spouse and after their death, the pension corpus, as accumulated at age 60 of the subscriber, would be returned to the nominee of the subscriber.

c) The contributions made under this scheme enjoy the same benefits that one gets under the National Pension System (NPS) scheme. The contributions you make under this Atal Pension Yojana scheme, can avail income tax benefits under Section 80CCD (1B) of the Income Tax Act.

d) The minimum pension would be guaranteed by the government. This means if the accumulated corpus based on contributions earns a lower than estimated return on investment and is inadequate to provide the minimum guaranteed pension, the central government would fund such inadequacy. Alternatively, if the returns on investment are higher, the subscribers would get enhanced pensionary benefits.

e)  Subscribers can voluntarily exit from Atal Pension Yojana subject to certain conditions, on deduction of government co-contribution and return or interest thereon.

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