Gratuity:
|
Gratuity Under Award |
Gratuity under Act |
|
|
Eligibility |
a) The death of the employee, b) Employee becoming physically or
mentally incapable of further service, c) Termination of Service d) Retirement on superannuation
and e) On voluntary retirement or
resignation after 10 years of continuous service |
A) Retirement on superannuation B) Resignation after 5 years of
service C) Death and D) Disablement |
|
Formula for calculation |
One month pay for each completed
years of service (max) 15 months pay + 1/2 month pay for each year beyond 30
years of service. *Pay = Basic Pay + Special Pay +
Officiating Pay + PQP+ increment component of FPP. * Based on Average of the last 12
months. * Service of more than 6 months
will be taken as one year. |
15 days wages X No of years of
Service i/e., 15/26 X Wages X No of
years of service. *Wages = Basic Pay + DA + Spl. pay
+ PQP +Officiating Pay + increment component of FPP *One day Wage = Monthly wage
divided by 26 * Based on Last drawn Salary * Service of more than 6 months
will be taken as one year |
|
Maximum Amount Payable |
No ceiling |
Max. Rs.20,00,000 |
|
Tax Exemption |
Exemption up to Rs.20,00,000 |
Exemption up to Rs.20,00,000 |
Pension Scheme (Old) Highlights:
(to those who have joined before 01/04/2010)
1. Pension will be payable on
retirement to permanent employees who have put in minimum of 10 years of
service (on superannuation).
2. Pension is to be paid on 50% of
the average of the pay drawn by an employee during the last 10 months of his
service in the bank.
Here Pay refers to the Basic pay + Special Pay + PQP + Increment component of
FPP (Basic Pension)
3. He is allowed to commute up to a
maximum of 1/3 of his Pension and take a lump sum payment on the commutation
value.
4. Dearness Relief is payable on
Basic Pension. DA will be revised every half year according to rise and fall of
Consumer Price Index.
5. Dearness Relief is payable on the
full pension including the commuted value.
6. Completed service of 33 years
will qualify for full pension. If the service is less than 33 years,
proportionate pension shall be paid.
7. In case of an employee
voluntarily retiring on completion of 20 years of actual service, his
qualifying service shall be increased by a period not exceeding 5 years, so
however, that the total qualifying service of such employee shall not in any
case exceed thirty three years and also shall not take him beyond the date of
superannuation.
8. For those employees who are
retiring on superannuation, the notional service of 5 years shall not be added.
9. The commutation factor ( varies
as per age) for a retiring employee who has completed 60 years will be 9.81.
10 Formula for calculating
Commutation Value=
1/3 of Basic Pension X 12 X Commutation factor.
Example:
If an employee gets a Pension of Rs.15000, he may commute a maximum of Rs.5000
and the commutation value will be =Rs.5000 x 12x 9.81= Rs. 5,88,600
|
Family Pension: Payable
after the death of Employee while in service or after retirement. |
|
Scale of Pay per month |
Amount of Monthly Family Pension |
|
Upto Rs. 11,100 |
30% of the ‘pay’ subject to
Minimum of Rs.2,785 per month |
|
Rs. 11,101 to Rs.22,200 |
20% of the ‘pay’ subject to
Minimum of Rs.3,422 per month |
|
Above Rs. 22,200 |
15% of the ‘pay’ subject to
Minimum of Rs.4,448 per month and Maximum of Rs.9,284 |
Details of National Pension
Scheme(NPS) (to those who have joined after
01/04/2010)
NPS (National Pension System) is a
defined contribution based Pension Scheme launched by Government of India .
It is applicable to Bank Employees
who joined Banking industry on or after 01.04.2010.
It is based on a unique Permanent
Retirement Account Number (PRAN) which is allotted to each Subscriber upon
joining NPS.
PFRDA has now launched a
separate model to provide NPS to the employees of corporate entities, including
PSUs (including Banks). This model is titled "NPS -
Corporate Sector Model".
On successful registration, a PRAN
(Permanent Retirement Account Number) will be allotted to the subscriber. A
PRAN Kit containing PRAN card, Subscriber details (referred as Subscriber
Master List) and an information booklet is sent to the subscriber's registered
address. The T-Pin and I-Pin are sent separately to the registered address. In
case of the Corporate Sector subscriber, the PRAN Kit alongwith T-PIN &
I-PIN will either be sent to the subscriber's registered address or at the
Corproate Head Office as per the option selected by the Corporate.
The PRAN Card is a document with
PRAN, subscriber's name, father's name, photograph and signature/thumb
impression.
NPS Account Information:
The NPS Scheme offers 2 types of
account
1.
Tier I account – it is also
known as Pension Account. Withdrawal from this account is restricted till the
Subscriber attains the age 60 years. Minimum yearly contribution requirement in
this account is Rs.6000.
2.
Tier II account – it is a
normal investment account. Withdrawal from this account can be done as per the
need of the Subscriber. Minimum yearly contribution requirement in this account
is Rs.250 however on 31st March of each year total value of units in this
account should be equal to or more than Rs.2000
An active Tier I account is
mandatory for opening Tier II account. Tier II account can be opened along with
Tier I account or at any time after Tier I account opening.
Fund options:
NPS gives Subscribers option to
invest according to their choice and risk appetite among three funds. Three
funds under NPS are
1.
Equity (Asset Class E)
2.
Corporate Bonds (Asset Class C)
3.
Government Securities (Asset Class
G)
Subscriber can switch the asset allocation
once in a financial year.
Investment Options:
Depending on the expertise on taking
call on right asset mix, Subscribers have 2 investment options under NPS
1.
Active Choice – Under this
option, subscriber can select the asset allocation among Equity, Corporate
Bonds and Government Securities as per his / her choice.
2.
Auto Choice – Under this
option, fraction of funds invested across three asset classes is determined by
a pre – defined portfolio which will be based on the age of the Subscriber.
This is also known as Life Cycle Fund option.
Tax Implication of NPS:
§ Employer's
contribution to NPS on behalf of the employee is treated as perquisite in the
hands of the employees, but is deductible u/s 80CCD (2) of the Income tax Act,
1961 to the extent of 10% of basic salary. This deduction is over and above the
limit of Rs.1.5 lac u/s 80 CCD (1). This will lessen the tax burden of the
employee to the extent of amount deductible u/s80CCD (2) of the Income tax Act,
1961.
§ Contribution by individual employee is eligible for a deduction from Income under Section 80CCD (1) of the Income Tax Act 1961 upto Rs 1.5 Lakhs. However, investments under Section 80C Section 80CCC and 80CCD(1) should not exceed Rs.1.5 lakhs per assessment year to claim for the deduction.
An additional exclusive tax benefit of Rs.50,000/-
under section 80CCD (1B) per assessment year (applicable from F.Y 2015-16/A.Y
2016-17) for NPS investments.
Withdrawal
from Tier I NPS account:
Amount
from Tier I account can be withdrawn only on exit from NPS. Exit from NPS can
be done at any point of time. The payout would be made to Subscriber as per
below chart
|
Withdrawal before the age 60 years |
Up to 25% of Employee’s
contribution can be withdrawn in lump sum. Three times before 60 years of age |
|
Withdrawal on attaining the age 60
years |
1. Up
to 60% of Corpus can be withdrawn in lump sum (No Tax on
this withdrawal ) 2. Minimum
40% of the Corpus needs to be invested in Annuity |
Subscriber can opt for any of the following options to
receive pension by way of purchasing annuity
Annuity Schemes:
After retirement ,Depending on the need, Subscriber can
select any of the below mentioned annuity plan (i.e. monthly payment of a fixed
amount or PENSION as commonly called) offered by Annuity Service Providers
registered with PFRDA
Annuity payable for
life at a uniform rate to the annuitant only
Annuity payable for 5, 10, 15 or 20 years certain and
thereafter as long as you is alive
Annuity for life with return of purchase price on death of
the annuitant (Policyholder)
Annuity payable for life increasing at a simple rate of 3%
p.a
Annuity for life with a provision of 50% of the annuity
payable to spouse during his/her lifetime on death of the annuitant.
Steps to be followed to check NPS Balance:
First we have to visit https://cra-nsdl.com/CRA/ website
which is the official website of Central Record Keeping Agency
and of National Securities Depository Limited.
You
can get Balance, growth, statement of accounts etc., from the above website.
Every month you will be getting SMS about the amount credited to your NPS account.
However,
if SOT (Statment of Transanction) is required in soft copy, the subscriber can
give a request through CRA toll free number 1800-222-080 using TPIN.
SOT for last three financial years can be requested.
The SOT will be sent through email in the email id registered with CRA.
This is not a chargeable service.
Alternatively,
by login to CRA system using IPIN, the subscriber can print his/her SOT
(available for the last three years).
1.The
Union Cabinet recently passed a Bill that seeks to ask pension fund managers to
offer minimum assured return options to investors. This will come into force
only after Parliament passes the PFRDA Bill.
2.
Under the existing laws, up to 60 per cent corpus on maturity can be withdrawn
while at least 40 per cent has to be used to buy annuity. At present, returns
from annuity insurance plans are not tax-free like Old Pension.
For
more information, please visit
https://npscra.nsdl.co.in/citizens-scheme-informaion.php
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