Here’s how you can transfer your PF money to NPS account

By: | Published: March 9, 2017 3:57 PM

With a view to facilitate transfer from recognized provident fund to NPS, the I-T Department has provided an exemption from taxation to one-time portability from a recognized provident fund to the National Pension System.

The recognized provident fund/superannuation fund trust may initiate transfer of the funds as per the provisions of the Trust Deed read with the provision of I-T Act.

With a view to facilitate transfer from recognized provident fund to NPS, the I-T Department has provided an exemption from taxation to one-time portability from a recognized provident fund to the National Pension System.

Further, an amendment has been made under the I-T Act to provide exemption from tax to any payments from an approved superannuation fund by the way of transfer to the account of the employee under NPS referred to in Section 80CCD and notified by the Central government. With the introduction of the new provision, transfer of funds of an assessee employee from his existing superannuation fund to a pension account under NPS is not liable to be treated as income of such assessee for that said assessment year.

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Accordingly, in case the subscriber is interested in getting his recognized provident fund/ superannuation fund transferred to NPS, he may follow the process as mentioned below:

1. The subscriber should have an active NPS Tier 1 account which can be opened either through the employer (where NPS is implemented) by filling up the prescribed subscriber registration form or through the point of presence (POP) (Banks/non-banks entities registered as POPs with PFREDA) or online through eNPS on the NPS Trust website.

2. The subscriber presently under Govt./Private Sector employment is required to approach the recognized provident fund/ superannuation fund trust through the current employer by giving a request for the transfer of his recognized provident fund/superannuation fund to his NPS account.

3. The recognized provident fund/superannuation fund trust may initiate transfer of the funds as per the provisions of the Trust Deed read with the provision of I-T Act.
4. The recognized provident fund/superannuation fund may issue the cheque/draft in the name of:
In case of Govt. employee: Nodal office name (PAO or CDDO name)<> Employee Name <> PRAN (12 Digital no.)
In case of the subscriber presently under private sector including all citizen model: POP (Name of the POP) collection account-NPS Trust<> Subscriber Name<>PRAN (12 Digit No.)

5. In the case of the government employee, the employee should request the recognized provident fund/superannuation fund to issue a letter to his present employer mentioning that the amount is being transferred from the recognized provident fund/superannuation fund to be credited to the NPS Tier 1 account of the employee.

6. The present employer/POP that is the nodal office shall while uploading the fund may mention the transfer from recognized PF/superannuation fund in the remark column while uploading it through Arrears mode. The upload may be made as per the request letter of the ex-employer.

7. In case of private sector employee including subscriber under all citizen model, the employee should request the recognized provident fund/superannuation fund to issue a letter to his present employer/POP as the case may be, mentioning the amount to be transferred from the recognized provident fund/superannuation fund to be credited to the NPS account of the employee/individual tier 1 account.

8. The POP will get the amount collected and the same may be uploaded by the POP in the NPS account of the subscriber.

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It may be noted that as per the provision of the I-T Act, the amount so transferred from recognized provident fund/superannuation fund to NPS is not treated as the income of the current year and hence is not taxable. Further, the transferred recognized provident fund/ superannuation fund will not be treated as a contribution of the current year by employee/employer and accordingly, the subscriber would not make IT claim of contribution for this transferred amount.

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