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Atal Pension Yojana Scheme Explained

Learn more about the Eligibility, Benefits and Features

The Atal Pension Yojana scheme aims to provide financial security to individuals working in an unorganised sector after their retirement. The Government of India launched this pension scheme in 2015-16 to offer financial assistance to private employees as well who do not enjoy pension benefits.

In case you are not aware of the details of what the Atal Pension Yojana scheme is, please continue reading to learn more.

Objective of Atal Pension Yojana Scheme

The primary purpose of the Atal Pension Yojana plan is to encourage the beneficiaries to make a monthly contribution to avail post-retirement allowance benefits. The Central Government also aims to provide 50% of the total contribution a worker makes to the scheme. This is valid for candidates who applied before 31st December 2015.

Who is not Eligible for Government Co-contributions?

As mentioned above, being a beneficiary of the Atal Pension Yojana scheme, you can enjoy a Government contribution. However, taxpayers and individuals availing other social security schemes will not be able to benefit from the Government's co-contributions. Following is the list of enactments under which entitled individuals cannot avail the benefit:

Assam Tea Plantation Provident Fund and Miscellaneous Provision, 1955.
Jammu and Kashmir Employees’ Provident Fund & Miscellaneous Provision Act, 1961.
Seamens' Provident Fund Act, 1966.
Employees' Provident Fund & Miscellaneous Provision Act, 1952.
The Coal Mines Provident Fund and Miscellaneous Provision Act, 1948.

Now that you have completed learning about how Atal Pension Yojana works, let us delve into these scheme’s benefits.

6 Benefits of Atal Pension Yojana Scheme

Here are the top Atal Pension Yojana benefits to consider before enrolling under this scheme.

Guaranteed Pension

Beneficiaries of this scheme will receive a minimum monthly pension payment ranging from ₹1,000 to ₹5,000. You can increase or decrease this pension amount once a year. Also, the Pension Funds Regulatory Authority of India regulates the pension scheme. Therefore, it curbs all risks of monetary loss and ensures receipt of a guaranteed pension amount after you retire.

Regular Stream of Income Post-retirement

This scheme is beneficial to meet costly medical requirements and other expenses common in old age.

Facility to Appoint Nominees

If the beneficiary dies, his/her spouse will receive the pension benefits. If the candidate dies before 60 years, a spouse can either terminate the scheme or continue to maintain the account under his/her name and receive a similar pension amount. In case both die, a nominee is allowed to receive the benefits.

Private Sector Employees Can Also Enjoy the Benefits

In case you are a private employee and not covered by other pension benefits, you can apply for this scheme as well.

Tax Benefits

Enjoy Atal Pension Yojana tax benefits under Section 80CCD of the Income Tax Act. The maximum tax exemption limit is 10% of the total income up to ₹1.50 lakh under Section 80CCD (1). Moreover, you are eligible for an additional Atal Pension Yojana tax exemption of ₹50,000 per annum under Section 80CCD (1B) against a contribution of ₹50,000 per annum. However, tax laws are subject to periodical changes. Therefore, you can always consult a professional to get more insights into applicable deductions.

Flexible Subscription

This scheme allows applicants to opt for monthly, quarterly or half-yearly subscriptions.

4 Salient Features of Atal Pension Yojana Scheme

Take a look at the following Atal Pension Yojana features before applying under this scheme:

Auto-debit Facility

This scheme allows you to link your bank account to the Atal Pension Yojana scheme. The monthly payment is automatically debited from your account. Beneficiaries must ensure sufficient balance in their savings bank account to avoid payment failure, which leads to a penalty payment.

Withdrawal Policy

As an applicant, you are eligible to close the scheme with your concerned financial institution after attaining 60 years. The Government also entertains early withdrawal in case of terminal illness or death. However, you will only receive your cumulative contributions and earned interest if you withdraw from the scheme before turning 60.

Terms of Penalty

For delayed monthly contributions, you must pay a penalty charge. Take a look at the penalty charges against their respective monthly contributions:

₹100: Penalty of ₹1.
₹101-₹500: Penalty of ₹2.
₹500-₹1,000: Penalty of ₹5.
₹1000 and above: Penalty of ₹10.

Note that if you fail to provide monthly contributions for 6 consecutive months, the Government will freeze your account. If it continues for a year, the Government will deactivate it and return the accumulated corpus with the earned interest.

Age Limit

Candidates aged 18-40 years are eligible to invest in the Atal Pension Yojana scheme. Hence, if you are a recent graduate or have just taken admission in a college, you can ensure a risk-free retirement phase by investing in this scheme. Also, individuals in their 30s are eligible to make contributions for the next 30 years to secure financial stability after attaining 60.
In addition, you must have a savings bank account which must be linked with your Aadhaar card number or registered mobile number. You also must have a contribution of minimum 20 years.

Monthly Contribution and Expected Return in Atal Pension Yojana

The monthly contribution is based on your entry age of investment and the pension option you choose. Go through the following table to understand the monthly payments and the expected return you can get:

Monthly Pension of ₹1,000

The monthly contribution in this scheme will range from ₹42 to ₹264. As part of Atal Pension Yojana death benefits, the appointed nominee will receive up to ₹1.7 lakh after the primary applicant’s expiry.

Starting Age (Years of Contribution)	Monthly Contribution	Expected Return
18 (42 years)	₹42	₹1.7 lakh
25 (35 years)	₹76	₹1.7 lakh
32 (28 years)	₹138	₹1.7 lakh
39 (21 years)	₹264	₹1.7 lakh

Monthly Pension of ₹2,000

If you opt for the monthly pension option of ₹2,000, your monthly payment will range from ₹ 84 to ₹528. Your nominee will receive up to ₹3.4 lakh at the end.

Starting Age (Years of Contribution)	Monthly Contribution	Expected Return
18 (42 years)	₹84	₹3.4 lakh
25 (35 years)	₹151	₹3.4 lakh
32 (28 years)	₹276	₹3.4 lakh
39 (21 years)	₹528	₹3.4 lakh

Monthly Pension of ₹3,000

If you opt for this pension scheme, a monthly payment of around ₹126 to ₹792 will be debited from your account. The nominee will receive up to ₹5.1 lakh.

Starting Age (Years of Contribution)	Monthly Contribution	Expected Return
18 (42 years)	₹126	₹5.1 lakh
25 (35 years)	₹226	₹5.1 lakh
32 (28 years)	₹414	₹5.1 lakh
39 (21 years)	₹792	₹5.1 lakh

Monthly Pension of ₹4,000

In this case, you must make a monthly contribution ranging from ₹168 to ₹1,054 to get a maximum nominee return of up to ₹6.8 lakh.

Starting Age (Years of Contribution)	Monthly Contribution	Expected Return
18 (42 years)	₹168	₹6.8 lakh
25 (35 years)	₹301	₹6.8 lakh
32 (28 years)	₹551	₹6.8 lakh
39 (21 years)	₹1,054	₹6.8 lakh

Monthly Pension of ₹5,000

The monthly premium in this option ranges from ₹210 to ₹1,318 to get a maximum nominee return of up to ₹8.5 lakh.

Starting Age (Years of Contribution)	Monthly Contribution	Expected Return
18 (42 years)	₹210	₹8.5 lakh
25 (35 years)	₹376	₹8.5 lakh
32 (28 years)	₹689	₹8.5 lakh
39 (21 years)	₹1,318	₹8.5 lakh

From the above table, you can understand that the maturity benefits of Atal Pension Yojana primarily constitute a monthly allowance after retirement.

Keeping all these details of Atal Pension Yojana in mind, you can easily apply under this scheme to enjoy financial independence in your old age. Also, watch out for the latest Government notifications to keep yourself updated on the changes following this Atal Pension Yojana scheme.

Frequently Asked Questions

All

How to apply for the Atal Pension Yojana scheme?

Visit the nearest eligible financial institution where you have a savings bank account. Fill in the form and submit all necessary documents along with two copies of your Aadhaar card. You can also download the form to apply online with ease.

Is an online application facility available for this scheme?

Yes, only a few selected financial institutions offer online applications for this scheme. However, you should visit the bank directly in most cases.

How many accounts can a candidate open for this scheme?

The Government does not allow one candidate to enrol multiple accounts under this scheme. Hence, you are eligible to open only one account.

Can an income taxpayer join the Atal Pension Yojana?

Yes, income taxpayers can join this scheme and also enjoy Atal Pension Yojana income tax deductions on their contributions.

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గో డిజిట్ జనరల్ ఇన్సూరెన్స్ లిమిటెడ్ (గతంలో ఒబెన్ జనరల్ ఇన్సూరెన్స్ లిమిటెడ్ అని పిలుస్తారు) - రిజిస్టర్డ్ ఆఫీస్ అడ్రస్ - 1 నుండి 6 అంతస్తులు, అనంత వన్ (ఎఆర్ (AR) వన్), ప్రైడ్ హోటల్ లేన్, నర్వీర్ తానాజీ వాడి, సిటీ సర్వే నెం.1579, శివాజీ నగర్, పూణే -411005, మహారాష్ట్ర | కార్పొరేట్ ఆఫీస్ చిరునామా - అట్లాంటిస్, 95, 4వ బి క్రాస్ రోడ్, కోరమంగళ ఇండస్ట్రియల్ లేఅవుట్, 5వ బ్లాక్, బెంగుళూరు-560095, కర్ణాటక | పైన ప్రదర్శించబడిన గో డిజిట్ జనరల్ ఇన్సూరెన్స్ లిమిటెడ్ యొక్క ట్రేడ్ లోగో గో డిజిట్ సొల్యూషన్స్ ప్రైవేట్ లిమిటెడ్‌కు చెందినది మరియు దీనిని గో డిజిట్ జనరల్ ఇన్సూరెన్స్ లిమిటెడ్ లైసెన్స్ కింద అందించి ఉపయోగిస్తుంది.