NPS withdrawal rules: 80% lump sum and the pension

NPS withdrawal rules changed in December 2025. For non-government subscribers (the all-citizen and corporate models), up to 80% of the corpus can now be taken as a lump sum at exit, and at least 20% must buy an annuity, which pays the pension. Before the change it was 60% and 40%.

The exit rules in a table

PFRDA’s press release also says the maximum entry and exit age is now 85, and partial withdrawals before 60 are allowed up to four times, four years apart. Government-sector subscribers have their own rules.

Worked example

Age 30, retiring at 60, ₹5,000 a month, an assumed 10% return, 20% to the annuity, annuity rate 6% a year. The NPS calculator gives:

Putting 40% into the annuity instead raises the pension to about ₹22,793 a month and lowers the lump sum to about ₹68,37,976. Raising the contribution by 5% every year lifts the corpus to about ₹1.80 crore.

Annuity rates vary

The pension depends on the annuity rate the insurer offers on the day you buy it, and on the annuity type (for life only, or with return of purchase price to a nominee). 6% is only an illustration. Check quotes before you exit.

How to use the NPS calculator

1. Enter your age, retirement age and monthly contribution, with any yearly raise.
2. Enter an expected return; it depends on your equity and debt mix.
3. Choose the annuity share (at least 20%) and an annuity rate, then read the corpus, lump sum and pension.

NPS is one part of a retirement plan. Work out the total you need with the retirement calculator and read how to calculate your retirement corpus. To draw down the lump sum, see how an SWP works.