What is the advantage of NPS Tier 2?
The account of NPS Tier 2 allows you flexibility of withdrawals or investments into the scheme. You can withdraw from your NPS Tier 2 investments as and when required without any limits. Moreover, no exit load is charged when you withdraw funds from your account of Tier 2 NPS.
Can I use NPS Tier 2 as saving account?
The NPS tier II account can be operated like a saving account without a cheque book but you will have to pay transaction charges for each transaction. Investment experts believe investors can use Tier II Account of NPS as a substitute of bank’s savings account.
How many times you can withdraw from NPS Tier 2?
NPS Tier 2 Withdrawal Rules There is no lock-in for NPS Tier 2. You can withdraw at any time from the NPS Tier 2 account. However, there is a lock-in of 3 years for government employees who are investing in NPS Tier 2 to avail of a tax deduction.
How many times we can withdraw NPS Tier 2?
What are the tax benefits of NPS Tier II?
Only central government employees are entitled to obtain income tax benefits under the National Pension System Tier II program. Private sector employees contributions to the NPS Tier II account will remain free from lock-in, but will not get tax deductions. 2.
What is the lock-in period of NPS Tier 2 account?
The Tier 2 account would also have a lock-in of 3 years. However these tax rules have not yet been notified by the Government. There is no tax deduction on NPS Tier 2 for private sector employees and the gains in the NPS Tier 2 are also taxable at slab rate.
What are the different types of NPS accounts?
Government employees would have the choice of three investment accounts under NPS – Tier 1 account which would be compulsory, Tier 2 account which has no tax benefits and allows free withdrawals and Tier 2 account with tax benefits which have a lock-in period of 3 years The investor would not get a choice in allocating his/her investments.
What are the benefits of investing in a Tier 2 account?
There are a number of benefits of actively investing in your Tier 2 account: · No additional effort to open tier 2 account, as an active tier 1 account suffices the registration process. · No minimum balance requirement. · Flexibility to transfer your Tier 2 investments into Tier 1 account and reap the benefits of tax incentives attached to Tier 1.