Atal Pension Yojana: Earn Rs. 5000 per month

The Government of India has introduced a special pension scheme to provide a defined pension to the citizens in the unorganized sector.

A Pension scheme called the Atal Pension Scheme launched in the budget 2015-16.

Earlier, Government had launched the Swavalamban Scheme in 2010 to provide the pension benefits to unorganized sector based on their contribution but  in this scheme there were no guaranteed benefits.

Therefore government re-launched this scheme with a new name Atal Pension Yojana with guaranteed benefits and with new rules.

This scheme introduced in June 2015.

In this scheme, subscriber would receive the fixed pension of Rs. 1000 per month, Rs. 2000 per month, Rs. 3000 per month, Rs. 4000 per month or Rs. 5000 per month at the age of 60 years depending on their contributions.

The contributions would be based on the age of joining the APY. Under this scheme, the benefit of fixed minimum pension would be guaranteed by the government.

The details of the scheme are as under:

Purpose of Atal Pension Yojana

The main objective of the scheme is to encourage the persons to have small amounts during their productive years to enable them to draw a pension in old age.

It has been administered by Pension Fund Regulatory and Development Authority (PFRDA) under the platform of National Pension Scheme.

Eligibility for Atal Pension Yojana

1. Any citizen of India in unorganized sector.
2. The subscriber must have a saving bank account or a post office saving bank account.
3. The age limit for Atal Pension Scheme is 18 years and not more than 40 years.
4. The subscriber must have a valid mobile number and aadhaar number. If at the time of joining the scheme the subscriber doesn’t have a aadhaar no. he/she can submit it within in a prescribed time.

But the subscribers of Swavalamban scheme are automatically migrated in this scheme who are between the age of 18-40 years and those who are above the age of 40 years, have the option, if they do not want to continue in Atal Pension Scheme, can withdraw the lump sum amount or to continue till the age of 60 years and be eligible for the annuities there under.

Government contribution in Atal Pension Yojana

The Government co-contributes 50% of the total contribution or Rs.1000 per annum, whichever is lower, to each eligible subscriber account, for a period of 5 years i.e. from F/Y 2015-16 to 2019-20.

But the benefit of the government contribution would be available to swavalamban beneficiary for 4 years as they already received the government contribution for 1 year in Swavalamban scheme.

Who are eligible for government contribution?

Government should contribute in the account of the following subscriber:

1. The subscriber should join the scheme between 01.06.2015 to 31.12.2015.
2. The subscriber is not income tax payers.
3. The subscriber is not member of any statutory social security scheme.

Procedure for opening an Atal pension account

If the subscriber is a bank account holder-

1. Firstly, the subscriber should submit the Atal Pension Scheme form with necessary information.
2. Mobile no., aadhaar no., spouse name and nominee name is mandatory for this application.
3. Deposit the amount of initial contribution selected by the subscriber according to the type of pension.
4. Submit the authorization letter to the bank for the monthly auto debit option for remittance of contribution.
5. After submitting the above documents the Permanent Retirement Account Number (PRAN) received by the subscriber, immediately which is written by the bank on the acknowledgement and hands it over to the subscriber over the counter.

If the subscriber is a non bank account holder-

1. Firstly, the subscriber should open a bank account by providing the KYC documents.
2. After opening an account, the subscriber should submit the APY form with necessary information.
3. Mobile no., aadhaar no., spouse name and nominee name is mandatory for this application.
4. Deposit the amount of initial contribution selected by the subscriber according to the type of pension.
5. Submit the authorization letter to the bank for the monthly auto debit option for remittance of contribution.
6. After submitting the above documents the Permanent Retirement Account Number (PRAN) received by the subscriber, immediately which is written by the bank on the acknowledgement and hands it over to the subscriber over the counter.

If the subscriber doesn’t have an aadhaar, he can apply for the Atal Pension Scheme account but they need to submit their aadhaar details within specified time duration.

How to contribute in Atal Pension Yojana?

Contributions are to be deposited by selecting monthly auto debit facility.

Penalty for non-payment of the contribution in Atal Pension Yojana

The subscriber shall pay penalty for non-payment of the contribution. The penalty will vary according the amount of contribution.

1. 1 per month for contribution upto Rs.100 per month.
2. 2 per month for contribution upto Rs.101 to 500 per month.
3. 5 per month for contribution between Rs.501 to 1000 per month.
4. 10 per month for contribution beyond Rs.1001 per month.

The amount of penalty will remain as part of the pension corpus of the subscriber.

If the default continues the following action shall be taken:

1. The account shall be frozen after the 6 months of default.
2. The account shall be deactivated after the 12 months of default.
3. The account shall be closed after the 24 months of default.

After closing the account, the government contribution will be forfeited with penalty and subscriber can withdraw his contribution as lump sum.

Forms related to Atal Pension Yojana

Subscriber can get the all forms related to Atal Pension Scheme by clicking the following link:

https://www.npscra.nsdl.co.in/nsdl-forms.php

Which banks are authorized for this Atal Pension Yojana?

The following banks are authorized for Atal Pension Scheme:

How to find Atal Pension Yojana Registration form ?

The subscriber can download the form by clicking here.

Is subscriber open more the one account under this scheme?

No, the subscribers can not open more than one account.

Is Atal Pension Scheme is eligible for tax benefits?

Yes, Atal Pension Scheme is eligible for tax benefits. The additional deduction of upto Rs.50000 for the amount deposited in NPS account & Atal Pension by the taxpayer has allowed in section 80CCD(1B).

How to get Atal Pension Scheme Statement online?

Subscriber will get the statement in two ways online and offline:

Online Procedure

Step 1: Click on this link. https://www.npscra.nsdl.co.in/scheme-details.php

Step 2:  Click on “APY e-PRAN/Transaction statement View” tab as shown in below screen.

Step 3: The below given window will get appeared.

Step 4: Enter your PRAN and bank account details to view the statement.

Offline Procedure

The subscribers get the periodical sms alerts on the registered mobile number in the bank or statement deliver to the address, of the subscriber by post. Address should be updated in Atal Pension Scheme data with bank.

What is the corpus amount?

Corpus amount included-

1. Subscriber contribution
2. Government of India contribution
3. Interest returned on subscriber and government contribution

Where will the subscriber savings be invested?

The contributions under this scheme are invested as per the investment pattern specified by the Government.

1. G-Securities-Min-45% and up to 50%,
2. Debt Securities and term deposits of banks- minimum 35% and up to 45%,
3. Money market instruments minimum- up to 5%,
4. Equity and related instrument- minimum 5% up to 15%
5. Asset backed securities etc.-up to 5%.

The subscribers do not have any other choice on investment pattern or pension fund.

How will subscriber know his amount of contribution?

The government will provide a contribution chart to select the contribution amount by the subscriber.  

The subscribers can make the contribution monthly, quarterly and half yearly.

Below, we provide the calculator for the contribution of the Atal Pension Scheme:

When will a subscriber be exit from the Atal Pension Yojana?

A subscriber can exit from the scheme on attaining the age of 60. On exit from the scheme, the subscriber will submit the request to the bank for withdrawal and get the pension according to their contribution.

If he died after 60 years than pension will be available to the spouse and if both died (spouse and subscriber) then the accumulated pension wealth till the age of 60 years of  the subscribner will be given to the nominee.

Whether exit before attaining the age of 60 is possible?

Yes, in the case of death/terminal disease of subscriber before the age of 60 years, the accumulated corpus would be available to the subscriber/nominee.

A option will be available to the spouse whether to continue the APY account of the subscriber with the predetermined contribution with the spouse name till the original subscriber would have attained the age of 60 years after that the pension would be available to spouse till the death of spouse.

Whether voluntary exit is possible before attaining the age of 60 years?

If the subscriber availed voluntary exit before 60 years, than he shall be received the amount of his contribution and interest earned thereon but he will not get the government contribution and interest thereon.

How to apply for voluntary exit before 60 years?

1. The subscriber can download the Atal Pension Scheme voluntary exit form by clicking here.

2. The subscriber should fill up the account closure form including the reason for closure and submit it to the bank.
3. The bank will verify the form and signature of the subscriber.
4. After accepting the form, the bank will provide a acknowledgement to the subscriber.
5. On receiving the application, the bank will intiate the closure procedure.
6. On completing the necessary procedure the bank will transferred the redeemed amount in the subscriber account.

Find here the details of Atal Pension Yojana in hindi

Please comment for your queries on Atal Pension Yojana.

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CA Harish Negi

Hey readers, welcome to my blog investsaver.com. I am Chartered Accountant by Profession and I love to write on tax & money matters. You may ask your queries through comments related to the topic, I will be happy to answer them.

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