Project your NPS corpus, monthly pension & tax savings under 80CCD(1B). Live calculation. Free PDF report.
Lump sum (tax-free) = Corpus × (100% - Annuity %) — typically 60%
Monthly pension = (Annuity corpus × Annuity rate%) / 12
80CCD(1B) gives ₹50,000 deduction OVER AND ABOVE the ₹1.5L 80C limit. Total NPS deduction up to ₹2L/yr.
NPS equity funds (Scheme E) have historically returned 10–14% CAGR over 10+ years. Government bond funds (Scheme G) return ~8–9%, and corporate bond funds (Scheme C) return ~9–10%. Returns are market-linked and not guaranteed. For projection, Moderate allocation (50% equity, 50% govt bonds) typically uses 10% as a blended expected return. Aggressive (75% equity) can use 12%, while Conservative (25% equity) suits ~8.5%. Always verify current NAVs at npscra.nsdl.co.in.
Your NPS corpus depends on three factors: monthly contribution, years invested, and return rate. For example, investing ₹10,000/month from age 30 to 60 (30 years) at 10% CAGR builds a corpus of approximately ₹2.26 crore. With mandatory 40% annuity, about ₹90 lakh funds a pension of ~₹45,000/month while ₹1.36 crore is received tax-free. Starting early makes the biggest difference — the same contribution started at age 40 (20 years) yields only about ₹76 lakh at 10%.
NPS offers three tax deductions under the old tax regime:
Section 80CCD(1): Up to 10% of salary (max ₹1.5 lakh within the 80C umbrella).
Section 80CCD(1B): An exclusive extra ₹50,000 deduction — completely outside the ₹1.5L 80C limit. This alone saves ₹15,000/year at the 30% slab.
Section 80CCD(2): Employer contributions up to 10% of salary (14% for Central Govt employees) — not capped under 80C.
Total self-contribution deduction: up to ₹2 lakh/year = ₹60,000 annual tax saving at the 30% bracket. Note: these deductions are not available under the New Tax Regime.
At age 60, NPS mandates purchasing an annuity with at least 40% of total corpus. The remaining 60% is received as a tax-free lump sum. Monthly pension = (Annuity corpus × Annuity rate%) ÷ 12.
Example: Total corpus ₹1 crore → Annuity corpus ₹40 lakh. At 6% annuity rate: pension = (40,00,000 × 0.06) ÷ 12 = ₹20,000/month. Actual annuity rates are quoted by IRDAI-regulated life insurers at retirement — currently ranging 5.5%–7% depending on age, type, and insurer.
Tier-I is the mandatory pension account with lock-in until age 60, limited premature withdrawal provisions, and full tax benefits (80CCD(1), 80CCD(1B), 80CCD(2)). It is the primary NPS vehicle and what this calculator projects.
Tier-II is a voluntary savings account with no lock-in — you can withdraw anytime. However, it offers no 80CCD(1B) tax benefit for non-government employees. Central Government employees can claim 80C benefit on Tier-II contributions if held for 3 years. Treat Tier-II as a liquid complement to your Tier-I pension savings.