What is Superannuation benefit fund and how to check it online?
This article is on based request from Kiran on "Suggest a topic".
Superannuation is a retirement benefit provided by employer. Companies have been making this benefit as part of the salary structure (CTC-Cost to company). Companies can create Superannuation fund account with any of the insurance companies like LIC, ICICIprulife etc. Employers are finding the ways and means to provide retirement benefits to employees to reduce attrition (resignations) so that employees can stay longer period with them. Along with PF and NPS, they are finding Superannuation as one more tool to provide retirement benefits to their employees.
Features of Superannuation benefit fund?
- Companies can open superannuation benefit fund with any of the approved agencies like LIC, ICICIprulife etc
- Employer need to contribute to maximum of 20% of the salary to Superannuation fund. Generally companies are making this part of the CTC itself. Means, the amount paid on this Superannuation is coming from employee salary itself. There is no specific contribution from employees like it is done for PF account.
- Returns on Super Annuation fund are almost same as Provident Fund interest rates. The interest amount would be credited to members account every year.
- If an employee resigns and moves to another company, he can transfer the amount to the new company provided the new company is having approved superannuation fund. In case new company does not provide superannuation fund facility, the employee can withdraw the amount, however necessary tax would be applicable.
How Superannuation fund is calculated?
- Less than 1 year of service – NIL
- 1 to 2 years of service – 50% of contribution + interest received from fund
- 2 to 3 years of service – 75% of contribution + interest received from fund
- 3+ years of service – 100% of contribution + interest received from fund
Means, if you stay beyond 3 years of service, employer would contribute to 100% of the amount allocated for Superannuation. If an employee works for less than 3 years, though it is part of CTC structure, the employee would not really get benefited.
What are the tax benefits of superannuation benefit fund?
a) Retirement: One third of the superannuation accumulated (contribution + interest) can be taken as tax free amount in lump sum payment and balance need to be used to buy annuities.
b) Resignation: In case of resignation of the employee, he would get equated interest amount to his account for his share. Beyond 3 years, he can opt for pension or contribution can be transferred to new employer who may have approved super Annuation fund. In case the facility is not available with new employer, he can withdraw and necessary income tax would be applicable based on individuals income tax slab.
c) Contribution: Superannuation contribution more than Rs 1 Lakh is treated as taxable perquisite in the hands of employee. Means such amount would attract tax and necessary tax would be deducted by employer.
How to check superannuation benefit fund online?
Below is the sample example on how to check superannuation benefit fund online for LIC and ICICI. But before that, you should check with your HR / Payroll department /Finance department about the super Annuation policy number and website details.
How to check Super Annuation fund with LIC or ICICIPrulife online?
- Visit website licindia.com or ICICIprulife.com
- Click on register option. Update Policy number / DOJ / DOB / Premium amount. I understand majority of Date of birth (DOB) are not updated in LIC records, hence you should indicate as “01/07/1960” or “07/01/1960” in case It is not working.
- Visit “Group Scheme” info
- Go to “members” section
- You can see accumulated balance of your superannuation fund.
The above process is only indicative and you may have further steps involved in it depending on the company where Superannuation fund is maintained. In case there are any additional steps, please provide the same, I would incorporate as part of above steps.
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What is Superannuation benefit fund and how to check it online