Atal Pension Yojana Scheme (APY): Benefits, & Fixed Pension

By Okbima 01 Mar 2024 954
atal-pension-yojana-scheme

 

The Atal Pension Yojana Scheme (APY Scheme) is government-backed in India aimed at providing financial security to citizens of the unorganized sector after the age of 60. In 2015, Prime Minister Narendra Modi initiated the launch.

 

What is the Atal Pension Yojana Scheme?

Atal Pension Yojana Scheme (APY) is a social security scheme launched by the Government of India in 2015. The primary objective of this scheme is to provide a sustainable pension to the unorganized sector workers who are not covered by any formal pension scheme. This is named in honor of Atal Bihari Vajpayee, a former Prime Minister of India.

 

What are the Benefits of Atal Pension Yojana ?

There are so many benefits to avail of APY such as it provides guaranteed minimum pension, government co-contribution, tax benefits, flexibility in contributions, etc.

  • Guaranteed Minimum Pension: On reaching the age of 60, subscribers will receive a guaranteed minimum monthly pension of Rs 1,000, Rs 2,000, Rs 3,000, Rs 4,000, or Rs 5,000, depending on their chosen contribution amount. This provides financial security after retirement, especially for those who work in the unorganized sector and may not have other pension plans
  • Government Co-contribution: The government will co-contribute to the subscriber's account up to Rs 1,250 per year for five years. This means the government adds extra money to your contributions, boosting your overall savings and future pension amount.
  • Tax Benefits: Contributions to APY are eligible for tax deductions under Section 80CCD(1) of the Income Tax Act. This can help you reduce your taxable income and save on taxes.
  • Flexibility in Contributions: You can choose to contribute a monthly amount ranging from Rs 1,000 to Rs 5,000, depending on your budget and affordability. 
  • Death Benefits: In case of the subscriber's death, the spouse will continue to receive the pension benefits. If both the subscriber and spouse pass away, the nominee will receive the accumulated pension wealth. 

 

Atal Pension Yojana Chart

Here is the Atal Pension Yojana Chart which shows how much pension you will get at what entry age, and how many years you have to contribute.

 

Entry Age (Years)

Total years of contribution

The monthly contribution amount required

Monthly pension Rs. 1000

Monthly pension Rs. 2000

Monthly pension Rs. 3000

Monthly pension Rs. 4000

Monthly pension Rs. 5000

18

42

Rs. 42

Rs. 84

Rs. 126

Rs. 168

Rs. 210

19

41

Rs. 46

Rs. 92

Rs. 138

Rs. 183

Rs. 228

29

40

Rs. 50

Rs. 100

Rs. 150

Rs. 198

Rs. 248

21

39

Rs. 54

Rs. 108

Rs. 162

Rs. 215

Rs. 269

22

38

Rs. 59

Rs. 117

Rs. 177

Rs. 234

Rs. 292

23

37

Rs. 64

Rs. 127

Rs. 192

Rs. 254

Rs. 318

24

36

Rs. 70

Rs. 139

Rs. 208

Rs. 277

Rs. 346

25

35

Rs. 76

Rs. 151

Rs. 226

Rs. 301

Rs. 376

26

34

Rs. 82

Rs. 164

Rs. 246

Rs. 327

Rs. 409

27

33

Rs. 90

Rs. 178

Rs. 268

Rs. 356

Rs. 446

28

32

Rs. 97

Rs. 194

Rs. 292

Rs. 388

Rs. 485

29

31

Rs. 106

Rs. 212

Rs. 318

Rs. 423

Rs. 529

30

30

Rs. 116

Rs. 231

Rs. 347

Rs. 462

Rs. 577

31

29

Rs. 126

Rs. 252

Rs. 379

Rs. 504

Rs. 630

32

28

Rs. 138

Rs. 276

Rs. 414

Rs. 551

Rs. 689

33

27

Rs. 151

Rs. 302

Rs. 453

Rs. 602

Rs. 752

34

26

Rs. 165

Rs. 330

Rs. 495

Rs. 659

Rs. 824

35

26

Rs. 181

Rs. 362

Rs. 543

Rs. 722

Rs. 902

36

24

Rs. 198

Rs. 396

Rs. 594

Rs. 792

Rs. 990

37

23

Rs. 218

Rs. 436

Rs. 654

Rs. 870

Rs. 1087

38

22

Rs. 240

Rs. 480

Rs. 720

Rs. 957

Rs. 1196

39

21

Rs. 264

Rs. 528

Rs. 792

Rs. 1054

Rs. 1318

40

20

Rs. 291

Rs. 582

Rs. 873

Rs. 1164

Rs. 1454

 

How to Apply for Atal Pension Yojana Scheme?

To open an Atal Pension Yojana Scheme (APY) account, you can follow these steps to open the account seamlessly.

Step 1: Go to the nearest bank branch and get the “Atal Pension Yojana Registration Form” or download it from here.

Atal Pension Yojana Scheme

Step 2: Complete the registration form with accurate and up-to-date information. Provide details such as your name, address, age, nominee details, Aadhaar number, bank account number, and mobile number.

Step 3: Submit the filled-in registration form along with any supporting documents, such as a copy of Aadhaar card, to the bank officials.

Step 4: Select the pension amount you wish to receive and the contribution period based on your age and financial capacity, and provide authorization for auto-debit from your bank account. 

Step 5: Your first contribution amount will be deducted from your linked bank account at the time of account opening. The bank will provide you with a receipt number or PRAN (Permanent Retirement Account Number).

Step 6: After the account is opened, you will receive a PRAN card (Permanent Retirement Account Number) from the National Pension System (NPS) Central Recordkeeping Agency (CRA). This card will have your unique PRAN, and it is essential for tracking your contributions and pension details.

 

Atal Pension Yojana Eligibility

The Atal Pension Yojana (APY) is a social security program supported by the government of India, created to offer a consistent monthly pension to individuals working in the informal sector.

Here are the eligibility criteria:

  • Age of the Subscriber: The minimum age to join the Atal Pension Yojana Scheme is 18 years, and the maximum age to enroll is 40 years.
  • Not Already Covered by Any Social Security Scheme: Individuals who are already covered under any social security scheme are not eligible to enroll in APY.
  • Bank Account: It is recommended for the subscriber to open a savings bank account. If the subscriber doesn't have a bank account, they need to open one before applying for APY.
  • PAN Card: The subscriber should have a valid Permanent Account Number (PAN) or provide a declaration in Form 60 if a PAN is not available.
  • No Pension Account: Individuals who are already receiving any kind of pension or have a Swavalamban account are not eligible for the Atal Pension Yojana Scheme

 

Charges to Maintain the APY Scheme Account

There are several charges associated with maintaining an APY account, categorized into two types: one-time charges and recurring charges.

1. One-time Charges

  • Account opening charge: Rs. 15/- charged once during account opening.
  • Downgrade/Upgrade charge: Rs. 25/- levied if you change your chosen pension amount.

2. Recurring Charges

  • Annual maintenance charge: Rs. 20/- deducted yearly from your APY account.
  • Investment maintenance fees:  For an electronic segment of AUM: 0.0075% per annum. For a physical segment of AUM: 0.05% per annum.

 

Tax Benefits for APY Scheme 

There are some tax benefits to avail of the Atal Pension Yojana Scheme such as the Deduction under Section 80CCD(1B), Section 80CCD(1), etc.

Contributions

  • Deduction under Section 80CCD(1B): You can claim a deduction of up to 10% of your gross total income or Rs. 1.5 lakh per year, whichever is lower, for contributions made to your APY account. This deduction falls under the same section as Tier 1 NPS contributions.

  • Additional deduction for low-income earners: Under Section 80CCD(1), an additional deduction of up to Rs. 50,000 per year is available for individuals with a gross total income below Rs. 10 lakh. However, this deduction cannot be claimed in addition to the 10% deduction mentioned above.

 

Pension Payouts

  • Partial tax exemption: Up to 40% of the lump sum received at the time of exit from the scheme after attaining the age of 60 is exempt from income tax.

  • Annuity taxation: The monthly pension received after maturity is taxed as per your applicable income tax slab.

 

Penalties for Late Payments of APY Scheme

Here are the penalties for late payments of APY Scheme that you should look at in 2024:

Monthly Contribution Range

Penalty for Late Payment

Up to Rs. 100

Rs. 1 per month

Rs. 101 to Rs. 500

Rs. 2 per month

Rs. 501 to Rs. 1,000

Rs. 5 per month

More than Rs. 1,000

Rs. 10 per month

 

Atal Pension Yojana Customer Care Number

Currently, there is no centralized toll-free helpline number for Atal Pension Yojana. APY accounts can be opened in different banks across India. Therefore, for any issues related to your APY account, you should contact the bank where you have opened your pension account. However, for APY assistance, you can reach out to the following toll-free numbers:

 

Customer Support Toll-Free Numbers:

  • CRA (Central Recordkeeping Agency): 1800-222-080

  • NPS Helpdesk: 1800-110-708

 

Read More:

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Sukanya Samriddhi Yojana - Interest Rate 2024

 

Conclusion

In conclusion, the Atal Pension Yojana is an initiative by the Indian government to promote financial security for the elderly population. By providing a guaranteed pension to those who have contributed during their working years, the scheme aims to alleviate poverty and ensure a comfortable retirement for all citizens. The scheme's low entry age and affordable contributions make it accessible to a wide range of individuals, particularly those in the unorganized sector. 

FAQs

Atal Pension Yojana Pran Number is a unique identifier assigned to individuals who have enrolled in the pension scheme to ensure proper tracking of their contributions and benefits.

To open an Atal Pension Yojana account in the Post Office, you must visit your nearest Post Office branch and fill out the required application form, providing all necessary documents and information.

The Atal Pension Yojana Death Benefits provide financial support to the nominee or legal heir of the subscriber in case of their untimely demise.

The Atal Pension Yojana (APY) is a government-backed pension scheme in India that is available to citizens between the ages of 18 and 40 years. This means that individuals who are between the ages of 18 and 40 can enroll in the scheme and start contributing towards their pension fund.

Atal Pension Yojana Maturity Amount is the total sum of money saved and accumulated by an individual under the pension scheme at the time of retirement.

To get an Atal Pension Yojana statement, individuals can log in to their APY account online or visit their nearest bank branch to request a statement of their contributions and account balance.

To check your APY account balance, download the "APY and NPS Lite" app, log in with your PRAN and registered mobile number, and view your account details.

APY eligibility: Age over 40, existing members of EPF/NPS, income taxpayers after Oct 1, 2022.

To close your APY account online, request a closing form from your bank or download it from the NSDL website. Log in to the official APY or your bank's website, fill out the online closure form, and submit the necessary documents for closure.

Atal Pension Yojana is a beneficial retirement scheme aimed at providing individuals with a secure financial future.

No, Atal Pension Yojana and the National Pension System (NPS) are two separate pension schemes offered by the Indian government with different features and eligibility criteria.

Individuals aged between 18 and 40 can join the Atal Pension Yojana with monthly contributions auto-debited for at least 20 years. Pensions range from Rs. 1,000 to Rs. 5,000 based on age and desired amount.

All banks and post offices registered with PFRDA offer Atal Pension Yojana. To open an account, individuals need a savings account and submit the filled-in form to the nearest POP-SP. Forms are available at bank branches in various languages for convenience.

No, Atal Pension Yojana (APY) is not for everyone. It is a pension scheme open to Indian citizens, specifically focused on the unorganized sector workers who do not have much exposure to other forms of social security.

Yes, you can withdraw from Atal Pension Yojana (APY) under certain circumstances like reaching age 60 for monthly pension, premature withdrawal in specific situations, or complete withdrawal if your corpus is less than Rs. 2.5 lakh. Be sure to consider the implications and consult a financial advisor if needed.

You can open an Atal Pension Yojana (APY) account offline by submitting a filled-in form to a bank or post office, or online by linking your Aadhaar and filling out a form digitally. KYC details will be replicated if you have an account with the bank.

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