This story is from December 26, 2019

Atal Pension Yojana (APY): Eligibility, contribution, amount, tax benefits and other details

NEW DELHI: Atal Pension Yojana (APY), which was previously known as known as Swavalamban Yojana , is a Indian government-initiated pension scheme for unorganised sector workers like drivers, gardeners, home maids and so on. The Atal Pension scheme was launched on a national level in June 2015. This social security scheme was introduced in place of government's previous Swavalamban Yojana NPS Lite, which did not go very well with the people.
Atal Pension Yojana is administered by Pension Fund Regulatory and Development Authority (PFRDA) and implemented through all the banks nationwide.
PFRDA also has an online registration facility via e-NPS or electronic-National Pension System channel. Those looking to subscribe to Atal Pension Scheme do not need to submit any physical documents under this process.
Eligibility for APY
The Atal Pension Yojana can be availed by all Indian citizens aged between 18 to 40 years. To have an APY account a person must have a saving account either with a bank or with post office of India.
What is the monthly contribution
Any APY subscriber, who is 18-year-old, needs to contribute Rs 42 to Rs 210 per month. The contribution amount goes up with an increase in age. The contribution amount is deducted from the subscriber's registered bank account by an automatic debit facility. The amount that has to be contributed depends on the age at which a person enrols in the scheme. The auto debit facility is optional. In case you do not opt for the process, the delayed contribution is payable with an overdue interest of 1 per month for contribution for Rs 100 or a part that is a part of corpus, as stated by the PFRDA.
The minimum time duration of contribution under APY pension scheme is 20 years.
Mode of contribution
APY subscribers can make their contributions to the pension scheme monthly, quarterly or half-yearly.

Pension amount
Minimum amount paid in the pension amount scheme are fixed at Rs 1,000, Rs 2,000, Rs 3,000, Rs 4,000 and Rs 5,000 per month. A subscriber can choose the minimum pension amount at the time of subscription. One of these pension amounts is paid to the subscriber after he/she is 60 years old. Higher the investment returns higher will be the pension the subscriber receives.
Income tax benefit under APY
Contributing to this pension scheme can get you the same tax benefits, such as the NPS (National Pension System). These contributions can be claimed under Section 80CCD (1B) of the Income Tax Act. As of 2018, the limit for income tax deduction Section 80CCD (1B) is Rs 50,000. This is over and above the Rs 1.5 lakh allowed under Section 80C.
Account Maintenance charges
table 2

Premature exit from APY
The PFRDA does permit exit before the subscriber attains 60 years of age and ‘only in exceptional circumstances, such as, in the event of the death/ terminal disease.
In case of death of the subscriber, the monthly pension will be paid to the spouse. This will go on till the spouse of the main subscriber is alive. After the death of the spouse, the accumulated pension wealth is handed over to the nominee of the subscriber. Also, in case the subscriber dies the spouse has the option to continue to contribute for the balance period.
  1. Who are eligible for APY (Atal Pension Yojana)?
    All bank account holders who are not members of any statutory social security scheme are eligible for the Atal Pension Yojana. The minimum age of users should be 18 years while the maximum age bracket reaches up to 40 years mark.
  2. What should be my contribution to avail of the Atal Pension Yojana?
    Since Atal Pension Yojana is meant for unorganized industry workers like gardeners, drivers, maids, etc, so, users under these occupations, above 18 years of age, need to contribute Rs 42 - Rs 210 per month.
  3. Can I close my APY or Atal Pension Yojana Scheme?
    Yes, you can voluntarily exit from APY anytime before the age of 60. Once the closure is done, the refund will come to your savings account.
  4. How does Atal Pension Yojana work?
    As per this scheme, a fixed pension of Rs 1000 or Rs 3000 or Rs Rs 4000 or Rs 5000 is promised for the unorganized sector workers depending on the kind of contribution done. The pension amount also depends on the age at which this scheme is taken.
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