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Atal Pension Yojana(APY)-Scheme Details, Amount, Elgibility

There are many investments that we must look upon to make our tomorrow secure from any financial problems. For government employees, there are so many ways like GPF, PPF, and many more. Thus, for the unorganized sector, there are various schemes came into force. Atal Pension Yojana or APY is one of them. So, let’s know more about it!

What Is Atal Pension Yojana?

Atal Pension Yojana or APY is implemented with an objective to provide the pension benefits to individuals in the unorganized sector. Pension Funds Regulatory Authority of India (PFRDA) synchronizes this plan. However, those who are in the organized sector and have no recourse for pension can also apply for this scheme.

The Central Government of India has launched three programs:

Jan Suraksha schemes during 2015-16, Atal Pension Yojana (APY),

Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), and

Pradhan Mantri Suraksha Bima Yojana (PMSBY).

Due to immense public response from the Pradhan Mantri Jan Dhan Yojana to avail banking with zero balance account, our former Finance Minister Late Shri Arun Jaitley decided to create an expanded and enhanced version of the National Pension Scheme, i.e., Atal Pension Yojana. It is a replacement for the former Swavalamban pension Yojana. In Atal Pension Yojana (APY), the investor will receive their accumulated amount as a monthly payment, just as a regular income.

In case, if you (the investor) pass away, your family or better half avails of it. However, if both, i.e., you and your spouse pass away, your nominee will receive the bulk of the amount. Hence, it’s a source of income in old age.

Thus, it helps people of retirement ages to save money for future needs. The entire bulk pension money depends on the amount you devote towards it every month. Added to this, your age is also taken into consideration. One can get this amount from the age of 60 years.

What Are The Extensions We Have From NPS In APY?

APY was launched in 2015 by Finance Minister Arun Jaitley. On the one hand, where NPS is for everyone, APY focuses on the unorganized sector. According to a circular issued by the Income Tax Department in 2016, contributions to APY will be eligible for the same tax benefit as NPS.

a. Age

The customer should be at least 18 years of age to open an NPS account. The maximum age is 55 years. For APY, a person must be 18 years or older to apply. The maximum age for contributing is 40 years.

b. Investment

There is no maximum investment limit for NPS, whereas APY works on a predetermined monthly contribution. Suppose you start investing as early at the age of 18 and invests Rs 210 per month for 42 years of his life. Then you will earn Rs 5,000 periodically.

c. Minimum Investment

Under the NPS scheme, you have to contribute a minimum of Rs 500 per month, while under APY, there are three payment modes for contribution: monthly, quarterly, and half-yearly. Thus, you’re required to pay a monthly payment of Rs 42 to get a minimum guaranteed return of Rs 1000.

d. Returns

Under the APY scheme, returns get decided beforehand. The return ranges from Rs 1000 to Rs 5000, with the denominations of 1000. For NPS, returns get associated with markets. This means that returns for NPS customers can vary depending on various factors, such as market movement.

e. Premature Withdrawal

As per APY rules, you’re not allowed to withdraw money before the tenure ends. However, in case you die or have a severe medical condition, you shall be entitled to withdraw the amount. For NPS, premature withdrawals will only be allowed in Tier 2 accounts.

Features of Atal Pension Yojana:

1. Raising The Amount Of Subsidy:

As stated above, the amount of pension at your 60s solely depends on how much money you had devoted towards this. Apart from that, it also includes how early you had started investing. These pension amounts vary with the different contributions you made in your producing ages. It may happen that you may devote more bucks towards this plan. As certainly, it will yield bigger fruits in the future.

To make your way easier, the government has laid other paths too. Now, you can add up or deduct from your actual payment towards this every month. Let’s say in a month; you had other prioritized expenditures too. So, indeed, you’ll not be able to devote more money towards this. In that case, you’ll have to decrease your subsidy. Thus, the thread is in your hand itself. When to lose and when to tighten, it’s completely your choice. All you need to do is consult your bank branch manager about it and work upon the necessity.

2. Auto-Debit:

It gives you the facility of auto-debit, so you should not take this into consideration. It will be paid automatically. The only thing you need to consider is the sufficient balance in your account, which is linked with the APY account so as not to penalize yourself.

3. Pension:

It can be provided into denominations of Rs. 1000, Rs.2000, Rs.3000, Rs.4000, Rs.5000, depending on your monthly contributions.

4. Age-Restriction:

This scheme has an age restriction between 18 to 40 years. So college students can also invest in this scheme, and the maximum bar is of 40 years because in this scheme you have to contribute for at least 20 years.

5. Premature Withdrawal:

You’re not permissible to extract the amount earlier than the requisite day. However, in cases like any severe illness or death, you’re permissible for withdrawal. You can get the total amount you expended for such cases.

However, if you discontinue the plan before turning 60s for any reason except stated above, you’ll be in a great loss. Although the sum and interest you earned on that sum, will get paid back to you. Yet you won’t get granted for any government gifts or extra bucks on the interest earned on your sum.

After attaining the age of 60 years, you will be eligible to withdraw the entire amount after the closure of the scheme with the bank concerned, i.e. get a monthly pension. You can also take all the reimbursements in case of any tragic illness before attaining the age of 60.

6. Penalty Charges:

If you miss your payments, a penalty will be imposed. A fine of Re. 1 is imposed on the monthly endowment of Rs. 100 and more.Fine of Rs. 2 is imposed on the contribution of Rs. 101 to Rs.500.

Rs. 5 fine will be imposed on the contribution of Rs.501 and Rs. 1000.Rs. 10 will be imposed on the contribution of Rs. 1000 and above. If in case you’re unable to pay your subsidy for 6 months, your account gets seized temporarily. However, if the delay continues until 12 months or more, it collapses on its own. Then, your entire amount gets paid back to you.

7. Tax Deduction:

The tax deduction portion of this scheme falls under section 80CCD. As per section 80CCD, a max of 10% of your total basic wage. However, the max limit is Rs. 1,50,000. Additional discount of Rs. 50,000 is allowed under Section 80CCD (1B) for devoting to Atal Pension Yojana.

Monthly Contribution For Atal Pension Yojana Chart Age-Wise

According to different ages, you must deposit dissimilar contributions. Keeping the fact of how much pension you want after 60, the payment varies. This graph will help you understand and analyze according to your specifications.

Monthly Contribution Of Atal Pension Yojana

Benefits Of Atal Pension Yojana:

1. Regular Income Source For Old Age:

This scheme financially enables you in the age of 60s to meet your necessities. This is specially made for the ones working in unorganized sectors, e.g., Maids, gardeners, etc. In case of any illness or accident, this scheme provides a sense of security to all such crowds.

2. Nominee:

Unfortunately, if you pass away, your wife gets to avail of it. However, there are situations where both the investor and his wife dies. Then, the nominee has the choice to avail the entire amount. He can deactivate the account and receive the same pension money. The nominee can be a legal heir or any other family member.

3. For Unorganised Quarter:

Why should government employees avail of all opportunities? Some get diverted towards the corporate sectors as well. For making their lives easier, this plan got implemented. Although ones who are in the organized sector and had no recourse to a pension can also apply for this Yojana.

4. Government-Supported:

This scheme gets backed by the government, so there is no means of loss or risk. Your hard-earned money is in protective hands.

Eligibility Criteria Of Atal Pension Yojana

i. You must be an Indian civilian.

ii. You must have a legitimate active contact number.

iii. Make sure your account is well tied-up with Aadhar Card.

iv. You must be in the age bracket of 18 to 40 years.

v. You must not be a part of other welfare plans.

vi. The min duration that you must fund to your account is 20 years.

Beneficiaries of Swavalamban pension Yojana are automatically migrated to this scheme.

Characteristics For Atal Pension Yojana

All nationalized banks offer this scheme. You can choose these banks to open your APY account.

Atal Pension Yojana can be accessed from online portals or from the other banks. This form can also be downloaded from the official site.

The forms are in service in English and Hindi and seven other regional languages, i.e., Bangla, Gujarati, Kannada, Marathi, Odia, Tamil, and Telugu.

Pen down the blanks in the form, after filling, handover them to the bank for further work.

If you have not already provided a contact number to the bank, provide a valid mobile number.

Also, carry with yourself two scanned pictures of your Aadhar card.

Frequently Asked Questions

1. Is it feasible for me to subscribe to the APY pension plan? What if I’ve not opened a savings account yet?

No, first of all, you need to open a savings account. Until and unless you save, how’ll you divert towards other fields? Then go for an APY subscription.

2. Is it mandatory to declare a candidate while applying for Atal Pension Yojana?

Yes, in case both you and your wife’s unfortunate death, your nominee gets the amount. So, you need to choose a person as your nominee. For more verification of your nominee, you must provide his KYC information as well.

3. Can I accumulate more than one pension accounts under this scheme?

No, you cannot accumulate multiple pension accounts under this plan.

4. Is there any way how I can apply for it online?

No, at present, there is no provision to apply online for APY. You can fill the form in the post office only.

5. What documentation you must carry with yourself to submit for this scheme?

To apply for the APY scheme, you need to submit the form accompanying a scanned Xerox copy of your Aadhar card. No further documents you need to carry.

6. How can I know if my scheme is functioning well or not?

You will get a notification pop up on your registered phone number once the plan gets approved.

7. When is the last date to which I can join the Atal Pension Yojana?

Atal Pension Yojana does not have any such last date to join the scheme. Handover this form as early as 1st June for being the part of this magnanimous scheme. The scheme gets revived every year by 1st June.

8. Is the money invested in this plan safe? Will the plan face any kind of transformation if the party changes?

Although this scheme is passed in the budget session, it doesn’t depend on Government bifurcations or change. The plan will not be closed if the government changes, and your contribution is safe. Any successful governments only have the right to rename the pension scheme.

9. What is the age tenure to join this scheme?

You can join this scheme as early as the age of 18 years. College going students can also go for it. The highest age for being part of this scheme is 40 years. Having the upper limit is due to the reason of the compulsory contribution duration of 20 years. From 60 onwards, you will start being paid with your pension.

Final Talk

Pension getting is another beautiful stage of life. Getting ripened fruits for a tree, you grew in the past is something to cherish for! I hope this article helped you in enlightening your views.

source http://invested.in/atal-pension-yojana/

source https://investedindia.wordpress.com/2020/09/23/atal-pension-yojanaapy-scheme-details-amount-elgibility/

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ATAL PENSION YOJANA OR APY – PENSION FOR COMMON PEOPLE

The government of India has introduced Atal Pension Yojana or APY for all Indians, basically the poor, underprivileged & unorganized workers. This scheme is to provide secure social security. Anybody can enrol in this scheme with a regular minimum contribution.

Atal Pension Yojana is a pension scheme mainly for the unorganized sector such as maids, daily workers, gardeners, delivery boys, etc. This scheme replaces the previous Swavalamban Yojana.

The goal of the scheme is to ensure that every Indian citizen gets a pension at old age. It is a Social Security Scheme. There is an option to get a fixed pension of Rs 1000, Rs 2000, Rs 3000, Rs 4000, or Rs 5000 on reaching the age of 60.

Highlights of ATAL PENSION YOJANA REVIEW

The pension is calculated on the basis of the individual’s age and the contribution amount. The subscriber spouse can claim the pension upon the contributor’s death. But, upon the death of both the contributor and his/her spouse, the nominee will get the accumulated corpus.

If the contributor dies before the age of 60, the spouse can either exit the scheme and claim the corpus or continue the scheme for the balance period.

The Government also make a co-contribution of 50% of the total contribution or Rs. 1000 per annum whichever is less to all eligible subscribers who had joined between June 2015 and December 2015 for a period of 5 years i.e., for financial years 2015-16 to 2019-20. But, the subscribers should not be part of any other statutory social security schemes like Employee’s provident fund, NPS or should not be paying income taxes, in order to avail Government’s co-contribution.

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Important Facts to Know about APY

Since you will be making periodic contributions, the amounts will be debited automatically from your account. Only, you make sure that you have sufficient balance in your account.

You can increase your premium at your will. So, visit your bank and talk to your manager and make the necessary changes.

If you default to pay the payment in time, a penalty will be imposed. A penalty of Rs.1 per month is calculated for a contribution of every Rs. 100 or part thereof.

If you default on your payments for 6 months, your account will be frozen and if the default continues for 12 months, the account will be closed and the remaining amount will be paid to the subscriber.

No permission for early withdrawal. But in cases like death or terminal illness premature withdrawal is allowed.

You can close the scheme before the age of 60 for any other reason. But, only your contribution plus interest earned will be returned. You will not get the government’s co-contribution or the interest earned on that amount.

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Eligibility for ATAL PENSION YOJANA or APY.

To get the Atal Pension Yojana benefit from you must fulfil the below requirements:

Must be a citizen of India.

Must be between the age of 18-40

Should make contributions for a minimum of 20 years.

Also, need a bank account linked with your Aadhar

Must have a valid mobile number

Those who are getting benefits of Swavalamban Yojana will be automatically migrated to Atal Pension Yojana.

How to Apply for ATAL PENSION YOJANA or APY?

Follow these steps to avail the benefits of APY

All nationalized banks provide the scheme. You can visit any of these banks to open your APY account.

Atal Pension Yojana forms are available online. You can get it from a bank also. You can download the form from the official website also.

Forms are available in English,Gujarati, Kannada,Hindi, Bangali, Marathi, Odia, Tamil, and Telugu.

Fill the application form correctly and submit it to your

Provide a valid mobile number.

Submit a photocopy of your Aadhaar card.

Get a confirmation message on your mobile.

The focus of ATAL PENSION YOJANA or APY.

The main target for unorganized sector workers. This scheme is to provide a defined contribution amount, a defined period of contribution and a defined amount of Pension.

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ATAL PENSION YOJANA Benefits or APY?

A Pension Scheme fully control by Government. Fixed pension guarantee scheme. Also, a fixed pension between Rs. 1,000/- to 5,000/- as per the plan you choose. Further, Central Government of India will co-contribute 50% of the total contribution or Rs.1,000/- per annum for the eligible subscriber for a period of 5 years i.e. from the financial year 2015-16 to the financial year 2019-20.

Regulatory Authority of ATAL PENSION YOJANA or APY?

It is a Government of India Scheme and Pension Fund Regulator and development authority or PFRDA is the regularity authority of APY Scheme.

Eligibility Criteria for ATAL PENSION YOJANA or APY

It is open to all bank account holders.

Age should be between 18 – 40 years.

Not covered with any other social security schemes.

The only Citizen of India can open APY Scheme.

But an Income Taxpayer is not allowed.

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Amount of Pension in ATAL PENSION YOJANA Amount

The minimum pension is Rs.1,000/-

The maximum pension is Rs.5,000/-

The Contribution Period of ATAL PENSION YOJANA Age Limit or APY.

The minimum age of joining in APY is 18 years and maximum joining age is 40 years. Your age of exit and the start of pension would be 60 years. So, the minimum period of contribution under APY would be 20 years or more.

Hence, the minimum contribution period is 20 years.

If you join at the age of 40, you have to stay invested for the next 20 years till you reach 60 years of age.

FROM WHERE YOU CAN OPEN YOUR APY ACCOUNT?

Any nationalized bank or any public sector bank providing this facility.

All Point of Presence POP.

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Penalty if you delay the contribution?

You will get a penalty if you delay the contribution.

Rs. 1 penalty per month for the contribution up to Rs 100/- per month.

Rs. 2 penalty per month for contribution between Rs 101/- to 500/- per month.

Rs. 5 penalty per month for contribution between Rs 501/- to 1,000/- per month.

Rs. 10 penalty per month for contribution beyond Rs 1,001/- per month.

Penalty if you miss the contribution?

You will get a penalty if you miss the subscription.

After 06 months account will close.

Also after 12-year account will deactivate.

After 24 months account will close.

Can you exit the Pension before maturity?

The maturity period is 60 years.

Can not exit before 60 years. However, in some exceptional circumstance i.e. death of a beneficiary or discovery of terminal illness premature exit is possible.

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Taxation on Ayal Pension Yojana

Contributions made by an individual in the Atal Pension Yojana 80C are eligible for the deductions under section 80CCD of the Income Tax Act, 1961.

Maximum deduction allowed under section Atal Pension Yojana 80CCD (1b) of the Income Tax Act, 1961 is 10% of the gross total income subject to a maximum deduction of Rs. 1,50,000 p.a. It is specified under section 80CCE of the Income Tax Act. All comes under section 80C.

An additional contribution of Rs. 50,000 p.a. is eligible for an additional deduction of Rs. 50,000 p.a. above Rs. 1,50,000 under section 80CCD1B of the Income Tax Act, 1961.

These deductions are subject to the fulfilment of the conditions mentioned in the Income Tax Act, 1961. Tax laws are subject to amendments from time to time.