National Pension System (NPS) is one of the best options for regular earning after retirement. It has many features which make it attractive including high returns, maximum tax exemption, flexibility in investment. It is beneficial for everyone from job seekers to self-employed. Let’s know five advantages of investing in NPS.
Invest with your convenience
The flexibility of investing in NPS is one of its attractions. There is no upper limit of investment in this i.e. you can invest in it as per your convenience. Whereas in other tax exemption options, the maximum investment limit is fixed.
More benefits to husband and wife
This is the only investment scheme in which both self-employed spouses can invest and avail separate tax exemptions. By investing in it, they get the benefit of depositing maximum amount and high interest. When he wants to stop working then he will have huge amount.
Benefits to both the employee and the employer
Under NPS, employees are benefited on the one hand by motivating them to invest and on the amount deposited for it. On the other hand, companies get tax exemption under section 36 (1) of Income Tax.
Biggest tax savings
Investment in NPS is eligible for tax exemption of up to Rs 50,000 under the Income Tax section. This exemption is in addition to the tax exemption of Rs 1.50 lakh available under section 80C of Income Tax. In this way, a total tax exemption of Rs 2 lakh is available on NPS.
Borrowers cannot seize NPS
Many times those doing their business have to face difficulties. In case of non-payment of loan due to loss, banks confiscate office, shop and house etc. But NPS is considered a personal investment, the amount of which cannot be forfeited by banks. In such a situation, NPS can be helpful in difficult times.