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NPS: Can you withdraw 100% of your corpus in National Pension System? Annuity rules, death benefits explained
Mint 1 hr ago·28 Sept 2026, 9:54 am
The National Pension System (NPS) is a popular retirement savings tool, but many investors are unsure about how to access their accumulated funds. The key question is whether you can withdraw the entire amount at once. Generally, the answer is no. The system mandates that at least 40% of your pension wealth must be used to purchase an annuity, which provides a regular income stream for life. This rule ensures you have a guaranteed source of funds after you stop working.
For investors under the age of 60, the remaining 60% can be withdrawn in cash, subject to tax deductions. However, if you are 60 or older, you are allowed to withdraw the entire corpus, but this full amount is taxable. The tax treatment depends on whether the withdrawal is treated as a lump sum or part of a pension purchase. It is crucial to understand these rules to plan your finances effectively.
For the family of a subscriber who passes away, the rules differ based on the age of the subscriber at the time of death. If the subscriber was under 60, the nominee can receive the entire corpus. If the subscriber was 60 or above, the nominee gets the entire corpus, but the subscriber's spouse has the option to receive the pension instead. Death benefits are designed to provide financial security to the family, but the specific payout structure varies by age and circumstance.
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