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1. Auto Choice (Lifecycle Fund):
If you prefer a hands-off approach, the Auto Choice option automatically manages your asset allocation. Your money is invested based on your age, gradually shifting from higher-risk assets to safer options as you grow older. You can choose from three distinct strategies:
Rules of Fund Allocation in National Pension Scheme
Auto Choice: You can choose the auto option if you can't decide the funds to choose and the per cent to allocate in them. In this, the allocation dynamically changes as per your age. As you grow old, your investment shifts to a safer option. The investment is made only in E, C, or G types. You have three options to choose from in Auto Choice: Aggressive: Maximum equity exposure of 75% up to the age of 35 Moderate: Maximum equity exposure of 50% up to the age of 3 Conservative: Maximum equity exposure of 25% up to the age of 35
Tax Benefits Available Under NPS (National Pension System)
Employee tax benefits on self-contribution: Tax deduction under Section 124 (previously 80 CCD(1)) of up to 10% of pay (Basic + DA), with a maximum of ₹1.5 lakh total under Section 80 CCE. Tax deduction up to ₹50,000 under Section 80 CCD(1B), in addition to the ₹1.5 lakh total cap under Section 123 (previously 80 CCE).
1. NPS Tier I Account (Primary Pension Account)
Tax benefits: Up to ₹1.5 lakh under Section 80CCD(1) of the Income Tax Act Additional ₹50,000 under Section 80CCD(1B)
Tax Benefits Available Under NPS (National Pension System)
Tax benefits for self-employed individuals: Tax deduction of up to 20% of their gross income under Section 124 (80 CCD (1), with an aggregate threshold of ₹1.50 lakh under Section 123 ( previously Section 80 CCE). Tax deduction up to ₹50,000 under Section 123 (previously called Section 80 CCD (1B)), in addition to the ₹1.5 lakh under Section 80 CCE.
1. NPS Tier I Account (Primary Pension Account)
Tax benefits: Up to ₹1.5 lakh under Section 80CCD(1) of the Income Tax Act Additional ₹50,000 under Section 80CCD(1B)