Overview

In order to promote NPS in corporate sector, NPS Corporate Sector model was launched by the regulator in December 2011. It is based on the concept of Employer - Employee relationship.

Under NPS Corporate Sector model, employee as well as employer can contribute to Tier I NPS account of the employee as mentioned below.

• Equal contribution from employer and employee
• Un-equal contribution from employer and employee
• Contribution either from employer or from employee

Tax Benefit on Tier-1 Contribution

• Contribution made by the employee to the extent of Rs. 1 Lac per annum is eligible for deductions u/s 80CCD(1) of Income Tax Act 1961 subject to aggregate amount of deductions u/s 80CCE doesn’t exceed Rs. 1.5 Lac.
• Contribution made by the employer to the extent of 10% of salary (Basic and DA) is additionally eligible for deduction u/s 80CCD (2) of Income Tax Act, 1961 without any upper limit in terms of value.

An employee can join NPS through Corporate Sector model only if his / her employer is registered for the same.
In order to know more about NPS Corporate Sector Model, please write to nps@idbi.co.in