NPS Exit at 60: How Much Can You Withdraw? (2026 Corpus Slab Guide)

If you're a non-government NPS subscriber with a corpus above ₹12 lakh, you can withdraw up to 80% as a lump sum at age 60 (or after completing 15 years of subscription). The remaining 20% must go into a mandatory annuity. This is a significant improvement from the old rule that capped lump sum at 60%. Government subscribers still follow the 60/40 split. The exact amount you can take depends on your corpus size — here's the full breakdown.

Corpus Slab Table: How Much Can You Actually Withdraw?

The rules aren't a flat 80/20 for everyone. PFRDA has defined three slabs based on your total corpus at exit:

Key point: The ₹8 lakh threshold means most serious NPS investors (anyone with 10+ years of contributions) will fall into the >₹12 lakh category and get the 80/20 split.

Government vs Non-Government: The Split Difference

Government subscribers include central government, state government, and autonomous body employees enrolled under NPS. If you're in the private sector, corporate NPS, or the All Citizen Model — you're non-government.

4 Ways to Take Your Lump Sum

You don't have to take your 80% (or 60% for govt) as a single withdrawal anymore. PFRDA now offers four options:

1. One-Shot Lump Sum

The traditional method. Your entire lump sum portion is credited to your bank account at exit. Simple, immediate, done.

Best for: People who have a specific use for the money (paying off a home loan, investing elsewhere) or those with smaller corpuses.

2. Systematic Lump Sum Withdrawal (SLW)

Introduced in October 2023. Instead of taking everything at once, you receive your lump sum in periodic instalments (monthly, quarterly, or annually) over a period you choose. The money moves to a separate account and is paid out on schedule.

Best for: People who want regular income from the lump sum portion but don't want market risk on it.

3. Systematic Unit Redemption (SUR)

Introduced in October 2024. Your lump sum stays invested in NPS, and a fixed number of units are redeemed each period. The rupee amount varies with NAV.

Formula: Units per payout = Total Units ÷ (Drawdown Period × Payout Frequency)

Best for: People comfortable with market fluctuation who want to stay invested while drawing down.

4. Retirement Income Scheme (RIS)

Launched May 2026. Your lump sum stays invested in a dedicated lifecycle fund (RIS Steady) with a declining equity glide path — 35% equity at 60, reducing to 10% by 75. You draw down using either SPR (percentage-based) or SUR (unit-based) till age 85.

Best for: People who want continued market-linked growth on their retirement corpus with a structured drawdown plan.

→ Full RIS breakdown with examples

The 20% Mandatory Annuity: What It Means

The portion that goes to annuity (20% for non-govt, 40% for govt) must be used to purchase a pension plan from a PFRDA-empanelled Annuity Service Provider (ASP). This gives you a guaranteed monthly pension for life.

Current ASP Options

Rates vary by age, annuity type, and whether you include spouse/return of purchase price.

Annuity Types Available

• Life annuity (no return): Highest monthly pension, but nothing goes to nominee on death
• Life annuity with return of purchase price: Lower pension, but nominee gets the principal back
• Joint life annuity: Pension continues to spouse after your death
• Annuity certain (5/10/15/20 years): Guaranteed for a fixed period, then life annuity

Practical advice: Most people choose "life annuity with return of purchase price" — it's a lower monthly amount but your family doesn't lose the capital if you die early.

Key Tax Point

The amount used to purchase the annuity is tax-free at the time of purchase. But the monthly pension income you receive from the annuity is fully taxable at your slab rate. This is often overlooked.

→ Full tax treatment explained

Can You Defer Your Exit?

Yes. You don't have to withdraw at 60. You can:

• Continue contributing and stay invested till age 85 (raised from 75)
• Defer the lump sum withdrawal — keep it invested, take it later
• Defer the annuity purchase — buy the annuity at a later age (higher annuity rates at older ages)
• Use RIS — effectively a structured deferral with periodic payouts

Deferring makes sense if:
- You're still working and don't need the money
- You want your corpus to grow further
- You're waiting for better annuity rates
- You want to use RIS for a gradual drawdown

Example: ₹50 Lakh Corpus at Age 60 (Non-Government)

Let's see what a ₹50 lakh corpus actually looks like at exit:

What the annuity gives you:

₹10 lakh annuity at ~6% (life with return of purchase price) = approximately ₹5,000/month pension for life.

What the lump sum gives you (if kept in RIS):

₹40 lakh in RIS Steady at age 60, SPR drawdown till 85:
- Year 1 payout rate: 4% = ₹1,60,000/year = ~₹13,333/month
- Corpus continues to earn market returns (35% equity, 55% govt securities, 10% corporate bonds at age 60)
- Payout rate increases each year as the formula adjusts

Combined monthly income at 60: ~₹18,333/month (₹5,000 annuity + ₹13,333 RIS)

This grows over time as the RIS payout rate increases and the corpus earns returns.

Tax on this:
- 60% of corpus (₹30 lakh) is tax-free under Section 10(12A)
- The extra 20% (₹10 lakh) between 60% and 80% may be taxable — see tax rules
- Annuity income (₹5,000/month) is fully taxable at slab rate
- RIS payouts — tax treatment depends on whether they fall within the 60% exemption

Step-by-Step: How to Exit NPS at 60

1. Log in to CRA (Protean or KFintech, depending on your CRA)
2. Submit exit/withdrawal request online or through your nodal office (for govt subscribers)
3. Choose lump sum method: One-shot, SLW, SUR, or RIS
4. Select Annuity Service Provider and annuity type for the mandatory portion
5. Submit KYC documents and bank details
6. Processing time: Typically 2-4 weeks for the lump sum; annuity starts within 30 days of purchase

You can also do this through your employer's nodal office if you're in corporate NPS.

Key Takeaways

• Non-govt subscribers get 80% lump sum, 20% annuity (if corpus > ₹12 lakh)
• Govt subscribers get 60% lump sum, 40% annuity
• Corpus ≤ ₹8 lakh = 100% withdrawal, no annuity needed
• You have 4 ways to take the lump sum — one-shot isn't the only option anymore
• You can defer exit till age 85
• RIS lets your money keep earning market returns post-retirement
• The annuity income is fully taxable — factor this into your retirement planning

Related articles:
- NPS Withdrawal Rules 2026: Everything That Changed
- NPS Premature Exit Before 60: The Rules Nobody Warns You About
- NPS Retirement Income Scheme (RIS) Explained
- NPS Withdrawal Tax Rules: The 60% vs 80% Problem
- NPS Partial Withdrawal Rules

Sources: PFRDA (Exits and Withdrawals) Amendment Regulations 2025 (notified 16 Dec 2025), PFRDA Circular PFRDA/2026/31/MWnR/01 (15 May 2026), NPS Trust (npstrust.org.in), Income Tax Act Section 10(12A).

Disclaimer: This article is for informational purposes only. Annuity rates and tax rules are subject to change. Consult a tax professional for advice specific to your situation. Arth tracks your NPS corpus alongside mutual funds, EPF, and other investments — visit askarth.com to see your complete retirement picture.