NPS Investment with Zerodha Coin| How to invest, Charges, Taxation

This IPO News guide/article covers “NPS Investment with Zerodha Coin| How to invest, Charges, Taxation”. The page is organized around what is nps or national pension scheme?, who can invest in nps with zerodha?, zerodha nps account type, zerodha nps charges, how to invest in nps with zerodha coin?. IPO News presents the structured facts and tables in its own layout and wording.

Topics Covered

• What is NPS or National Pension Scheme?
• Who can invest in NPS with Zerodha?
• Zerodha NPS Account Type
• Zerodha NPS charges
• How to invest in NPS with Zerodha Coin?
• NAV Applicable on NPS Investment through Zerodha Coin
• Zerodha NPS Investment Platform
• Zerodha NPS Withdrawal Rules and Regulations
• 1. At maturity when NPS subscriber reaches 60 years
• 2. Zerodha NPS Partial Withdrawal
• 3. Zerodha NPS Premature exit before 60 years
• 4. Exit upon NPS Subscriber’s death
• Zerodha NPS Taxation
• Zerodha Trade@20
• Frequently Asked Questions
• 1. How to track NPS investment in Zerodha?−
• 2. Can NRI invest in NPS with Zerodha?+
• 3. Can I pledge my NPS holdings for collateral margin in Zerodha?+
• 4. What are NPS Active and Auto investment choices in Zerodha?+
• 5. How to download Zerodha statement of Transactions for NPS?+
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Key Facts

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• Any individual resident account holder in Zerodha who are below 65 years of age can invest in NPS and prepare for their retirement.
• NPS has two types of accounts, a Tier 1 account and a Tier II account.
• Select an investment plan as Aggressive, moderate or conservative.
• Enter the 6-digit OTP and click on verify.
• Bank details have to be verified to open a NPS account. To do so, create a ticket and attach a latest 6 months bank statement or a cancelled cheque of the primary bank account.
• Note: When you place an order to invest in the NPS scheme, Zerodha will transfer funds to the trustee banks by 6 PM on the same day who will reconcile funds and allocate NPS units as per NAV applicable.
• A subscriber cannot withdraw the money invested in the NPS before reaching the retirement age of 60 years. Read the PFRDA rules for the withdrawal of money from the NPS account.
• If the NPS retirement corpus is less than Rs 5 lakhs, the subscriber can withdraw 100% or the entire NPS capital as lump sum.
• For medical and incidental expenses arising from disabilities
• As per PFRDA rules, you can withdraw 25% of the total contribution of 5 lakh, i.e. Rs 1,25,000. The balance of Rs 7 lakh is not eligible for partial withdrawal.
• Early or premature exit or voluntary retirement before the age of 60 years is also possible under several conditions;
• The subscriber must have completed 5 years of NPS subscription.
• The subscriber must purchase an annuity for at least 80% of the accumulated pension capital and 20% of the capital is paid out as a lump sum.
• If the total annuity capital is 2.5 lakhs or less, the entire amount can be withdrawn as a lump sum.
• If the NPS subscriber dies, the entire capital (100%) is paid to the nominee or legal heirs if the total capital is up to 5 lakhs. However, the nominee has the option to opt for a pension plan.
• If the NPS balance is more than Rs 5 lakhs, 20% is paid as a lump sum, and 80% of the pension wealth are used to buy an annuity.
• NPS is a tax-exempt pension product. Yes, investment in the NPS offers tax benefits of upto Rs 1.5 lakhs under Section 80C.
• There is also an additional tax deduction of Rs 50,000 is offered under Section 80CCD. So, in total, NPS subscribers can claim a tax deduction of upto Rs 2 lakhs for NPS investments in a year.
• On retirement, you can get 60% of the total retirement capital as a lump sum, which is tax-free. The remaining 40% is paid out as a pension or annuity to cover regular expenses post-retirement.
• A partial withdrawal of 25% of the total NPS investment is also tax-free.
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• Zerodha only allows customers to pledge equity and mutual funds holdings for margins at applicable haircut %.
• Auto Choice: In this option, asset allocation is set automatically based on NPS subscriber’s age and risk appetite (Aggressive, moderate, or conservative).
• Maximum allocation to equity asset class cannot exceed 75%.
• Maximum exposure to corporate bonds and government bonds is 100%.
• Maximum allocation to alternative asset like REIT (Real Estate Investment Trusts), InvIT (Infrastructure Investment Trusts), AIF (Alternative Investment Funds), and mortgage-backed securities is 5%.
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Data Tables

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