New Delhi (NVI): Pension Fund Regulatory and Development Authority (PFRDA) has now permitted Overseas Citizens of India (OCI) to enroll in National Pension Scheme (NPS) at par with Non-Resident Indians.
OCI is an immigration status permitting a foreign citizen of Indian origin to live and work in India indefinitely. The OCI was introduced in response to demands for dual citizenship by the Indian diaspora, particularly in developed countries. It was introduced by The Citizenship (Amendment) Act, 2005 in August 2005.
PFRDA is the statutory Authority established by an enactment of the Parliament, to regulate, promote and ensure orderly growth of the NPS and pension schemes to which this Act applies.
Government through notification dated October 17 said Foreign Exchange Management (Non-debt Instruments) Rules, 2019 of Dept. of Economic Affairs, has specified that an OCI may subscribe to the NPS governed and administered by PFRDA, provided such person is eligible to invest as per the provisions of the PFRDA Act and the annuity and accumulated saving will be repatriable, subject to FEMA guidelines.
Contributions made towards NPS are eligible for an additional tax deduction upto Rs. 50,000 which is over and above the Rs 1,50,000 limit of deduction available.
In the Union Budget 2019, the tax exemption limit for lump sum withdrawal on exit and maturity from NPS has been increased from the present 40% to 60% of the IT Act and the remaining 40% of the corpus is already tax-exempt as it is mandatorily utilized for annuity purchase, an official statement said.
As on October 26, the total number of subscribers under NPS and Atal Pension Yojana has crossed 3.18 crores and the Asset under Management (AUM) has grown to Rs. 3,79,758 crores. More than 66 lakhs government employees have been enrolled under NPS and 19.2 lakhs subscribers have subscribed to NPS in the private sector with 6,812 entities registered as corporates, the statement added.