Last Updated: January 10, 2023, 13:30 IST
The National Pension System (NPS) was created to promote retirement savings among citizens. It is an effort to find a lasting solution to the problem of giving all Indian residents a decent retirement income. By enabling participants to continuously save money throughout their working lives, NPS is a voluntary, defined contribution retirement savings plan that attempts to assist members in making the best decisions possible regarding their future.
Owners of NPS accounts can set money aside while they are still working. After retirement, the corpus amount amassed over the years will be handed to the account holders and your legal heir as an annuity. The PFRDA (Exits & Withdrawals under NPS) Regulations 2015 and modifications state that in the event of a subscriber’s passing, the subscriber’s whole accrued pension wealth (100 percent NPS Corpus) should be transferred to the nominees or legal heirs, as applicable.
What occurs, then, if the NPS account holder dies without having made a nomination or with an invalid nomination? If the deceased subscriber does not register the nomination prior to passing away, the accumulated pension wealth will be paid to family members in accordance with the legal heir certificate issued by the relevant State’s Revenue authorities or the succession certificate issued by a court with appropriate jurisdiction.
If a legal heir or nominee is available, they may file an NPS claim by providing a fully completed death withdrawal form and supporting materials, such as the subscriber’s death certificate, KYC records, and bank account information. A list of all required documentation may be found on the death withdrawal form.
The nominee or legitimate heir of the deceased subscriber must submit a properly filled-out death withdrawal form along with a number of supporting documents, including KYC records, the subscriber’s death certificate, proof of bank account, and other necessary documents, in order to claim an annuity. If more than one nomination is registered, the withdrawal form must be completed and submitted by all nominees.
However, a nominee or nominees must fill up and submit the relinquishment deed if they do not intend to claim the NPS corpus. The candidate requesting NPS benefits must also submit an indemnification bond at the same time.
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