Superannuation fund is a retirement benefit provided by employer to employee. This is like EPF, however, the contribution from the only employer side is done. Many corporates have incorporated superannuation fund benefit as part of employee CTC. However, many employees might forget about such benefit during a change in jobs. Some would have moved from job to business and they would have either forgotten it or they don’t have any clue how to withdraw superannuation fund. What is Superannuation fund? How to withdraw Superannuation Fund in India? What are various options available to an employee to withdraw / transfer such superannuation scheme?
Also Read: How an employee can calculate gratuity on their own?
What is Superannuation Fund?
These days, many corporates are offering the superannuation benefit, but there is limited information available over internet about some painful areas in it. If you search google, you would find superannuation fund details of Australia and not in India. So even Google has no clue about such complicated scheme. Superannuation is a retirement benefit provided by the employer to the employee. If this is part of your CTC break-up, then the employer should make contributions to your superannuation fund scheme either month on month or year on year. Generally, companies take Group Superannuation Scheme from any of the approved insurance companies like LIC, ICICI Life insurance, etc. The returns of the superannuation fund may differ according to the company providing the policy.
The employer keeps making contributions to the employee superannuation scheme year on year as long as the employee is with the company. Either on retirement or post resignation, the employee would have the option of buying a superannuation-linked pension from any insurance company. This need not be with the same insurance company where the superannuation fund is contributed.
Refer Superannuation fund scheme guide for more info.
When can employee withdraw superannuation fund in India?
Withdrawal of superannuation fund can happen in a few instances like
1) Death of the employee. In this case, either nominee or family members would make the withdrawal claim of superannuation fund.
2) Withdrawal possible when an employee changes the job. It is irrespective whether the new employer is providing superannuation benefit or not.
3) Withdrawal on the retirement of the employee.
4) Transfer superannuation fund benefit amount to NPS (Tier-1) in case employee resignation (this is movement and not withdrawal).
How to withdraw Superannuation Fund in India?
I am providing these details based on my recent personal experience, hence I feel these are accurate, but one need to recheck before they proceed in the superannuation withdrawal process.
There are two options available for employee.
1) Employee is allowed for commutation i.e. lump sum withdrawal
2) Employee is allowed to get annuity pension payment.
I) Superannuation withdrawal rules for commutation (Lumpsum withdrawal)
(i) Lump sum withdrawal up to 33% of a superannuation fund, if employee is eligible to receive a gratuity. The employee would be eligible for gratuity only if he works for 5+ years in the same company.
(ii) Lump sum withdrawal up to 50% of a superannuation fund, if employee is NOT eligible to receive a gratuity. Employee would NOT be eligible for gratuity if he has moved out of the company within 5 years.
e.g. if the employee worked for 5.5 years in the company and has superannuation fund accumulated value of Rs 10 Lakhs including interest. They would be eligible to take 33% i.e. Rs 3.3 Lakhs in lumpsum withdrawal option.
II) Superannuation withdrawal rules for Annuity Pension Payment
Once an employee chooses commutation option, the balance would be considered for annuity pension payment. In the above example, Rs 6.7 Lakhs would be paid through annuity pension payment option. One can consider any of the below options for this annuity pension scheme. These scheme details look more or less like annuity pension schemes offered by insurance companies. The details may slightly vary between the insurance companies, hence one need to check before opting them.
1) Life Annuity: This option pays annuity for life.
2) Life Annuity with an annual increase of 5%: This annuity pension option pays annuity for life. Annuity payout increases at a simple rate of 5% for each complete policy year throughout the life of the annuitant.
3) Life Annuity with Return of Balance Purchase Price: This option pays you annuity for life and on death, the Balance Purchase Price is returned to your nominee. Balance Purchase price will be equal to Purchase Price (premium paid by you in the beginning excluding taxes) less sum total of the annuities paid. If the balance is negative, then no benefit will be payable on death.
4) Life Annuity with Return of Purchase Price: This annuity option pays annuity for life and on death the purchase price is returned to the nominee.
5) Life Annuity with Return of 50% Purchase Price: Under this annuity option, annuity is paid for life and on death, 50% of the Purchase Price is returned to your nominee.
6) Life Annuity with Return of 75% Purchase Price: This option pays you annuity for life and on death, 75% of the Purchase Price is returned to your nominee.
7) Life Annuity guaranteed for 5, 10, 15 years and payable for life thereafter: This option pays annuity for a guaranteed period of 5, 10 or 15 years (as chosen by annuitant), and life thereafter. In case of demise during the guaranteed period, annuity for the remaining guaranteed period will be paid to the nominee.
8) Life Annuity with return of Purchase Price on Critical illness (CI) or Permanent Disability due to accident (PD) or Death: This option pays you annuity till earlier of first occurrence of any of the 7 specified CI after policy inception or PD, before the age of 80 years, or death. Further, the Purchase Price is returned to annuitant/nominee, in case of first occurrence of any of the 7 specified CI or PD before the age of 80 years, or death.
9) Joint Life Last Survivor without Return of Purchase Price: This option pays annuity for life and on death the annuity continues for the life of the named spouse. Where the named spouse has pre-deceased or where the named spouse is no longer a legal spouse at the time of annuitant demise, no further benefits are payable.
Also Read: LIC Jeevan VII Annuity Scheme provides regular pension – Should you opt?
10) Joint Life Last Survivor with Return of Purchase Price: This option pays you annuity for life and on death the annuity continues for the life of the named spouse. On the demise of the last survivor the Purchase Price is returned to your nominee. Where the named spouse is no longer a legal spouse at the time of your demise, no benefits shall be payable except the Return of Purchase Price to the nominee.
11) Joint Life, Last Survivor with Return of Purchase Price in parts: In this option annuity is paid to you for life and thereafter your spouse for his/her life. On the earlier of either your or your spouse’s demise, 50% of the Purchase Price is returned to the survivor (annuitant / annuitant spouse). After the death of the last survivor balance 50% of the Purchase Price, is returned to the nominee.
Where a named spouse is no longer a legal spouse at the time of annuitant demise, 100% of the Purchase Price shall be returned to the nominee and no further benefits are payable.
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Hi all,
if we transfer 100% Superannuation fund from existing LIC to NPS ( that is again asking for fund manager to opt for like HDFC, ICICI, SBI etc), is the GST payable on the entire fund when we move from LIC to any of my opted funds via NPS.
I am looking for more option to withdraw good amount at once with less tax including GST, rather than going for pension for rest of the life.
Hi, Transfers of superannuation funds from one approved retirement fund (such as LIC) to another approved fund (such as NPS) do not attract GST because these are exempt transactions under the Indian tax laws. This means no GST is payable when you transfer your entire superannuation corpus from LIC to an NPS account. I would recommend you to just check before making this transaction to double sure on this. For withdrwals T&C, pls refer the article
Hi.
I worked 7.9 years in KNPL. There also cutting for superannuation. I resign 2 months ago. That time i fill form and submitted in company .Now company tailings me because of lic your superannuation hold. Please suggest how to withdraw my money.
Regards
Mayur
Thank you for the informative article. Can I ask my employer to move my Super annuation fund to NPS? I am still working in the company. Also, will the future contributions go to NPS or Superannuation fund?
You can do only in case your current employer is discontinuing superannuation facility. In future if you are moving to new company and there is no superannuation, then you can transfer it to NPS.
I have moved outside India , how can I withdraw the superannuation corpus(LIC)
I have moved to UK . What is the rule in Superannuation . Can I keep the same in India or need to withdraw . Gratuity is already processed.
I completed 2 years service excluding 03 months notice period ( Jun21-Jun23+ 03 months Notice period).
Am I able to withdraw/transfer SA fund?
How to withdraws the superannuation amount. Now I am 53 years old and need to withdraw partial amount. Myself a member of this scheem from April 2012. and total service in same company is 28 years
Very good knowledge sharing, I worked for Axis Bank for one year in 2018, then I left my job. but I received a call from LIC 6 months back and they gave me a policy number and asked me If I want to withdrew my funds held with them or policy will expire, but due to lack of knowledge, as you already mentioned it in this article. I thought this is a fraud call and I Ignored, after 6 months, now when I went to my old mails to take out the details to process my PF settlement. Hear, I saw the Superannuation fund as well with LIC and I grabbed my head at the same time. Now, please let me know can I still have any chance to withdraw it or it lapsed? and how I can withdraw it any process with it?
Pls reach out to LIC to know the eligible amount which you can withdraw now
I have retired from service four years ago but I opted for superannuation pension scheme.
I now want to close this and withdraw the amount. Is it possible? If yes, what will be the procedure.
Thank you
If you have already opted for pension scheme under superannuation, you cannot withdraw the amount. It is possible to do partial withdrawal as per superannuation guidelines before opting for pension scheme.
Thank you very much for this informative post. I want your advice on one point. I am a member of Superannuation Fund maintained by LIC on behalf of my previous employer Hewlett Packard. I have left service two years back but did not withdraw my SAF corpus at that time.
Apart from the said SAF account , I opened an individual NPS Tier-1 account and contributed to it over last 8-9 years.
Now, since I have turned 60 years, I requested my employer Hewlett Packard to transfer my SAF corpus to my NPS Tier-1 account as per PFRDA circulars.
But my employer is not complying to my request. HP Payroll dept says that they cannot transfer SAF corpus to NPS and they can only offer annuity as per LIC SAF scheme.
Please advise what should I do or whom should I approach for redressing this .
Hello Chakravarthi, As per my knowledge, the option to shift SAF to NPS is available before retirement age. I did this for myself when I planned to move out of the organization in 2020 where I shifted SAF to NPS Tier-1. I did remember they were checking for the age too. In your case, since you crossed 60 years, they would have informed to take annuity only. But still you can ask them to provide lumpsum + annuity (both as per eligibility) and I feel you can still get some lumpsum money.
i want with draw my superannuation balance amount now it self. Now i am 55 years old. could you pls suggest me how to with draw
Hi Suresh… Regarding the 33% withdrawal option, is there Income Tax applicable on it ? I am 45 and it has been an year since i have left my old organization. I got to know that any withdrawals will attract income tax if it is before I turn 60.
Anfran, Amount withdrawn by the employee at the time of change of job is taxable under the head “Income from other sources”
Hello, I have opted for superannuation 1 year back, but somehow I am not able to track the amount details for this scheme. Can this scheme be discontinued?
Is there a way we can stop this scheme once started?
It depends on your employer. In case you have opted it, it would continue till you resign and move out of the company. Pks check with your employer.
Great contribution. My father expired and he was getting annuity from life insurance corporation where his employer deposited superannuation fund. Now which form has to be filled to get refund in savings account of mother, please guide.
Sunil, You need to approach LIC customer care or nearest LIC branch regarding this.
If we are not eligible for gratuity, then we can eligible to withdraw upto 50% of the superannuation fund. So what about the remaining 50% cumulative amount and how we can withdraw or what are benifits
Its implied that balance one has to take annuity plan
How can i move my Super annuation fund to NPS?
It is taxable?
First open NPS account and approach employer where you have superannuation and complete the documentation process
Hi. If I go for commutation, will the 33 percent withdrawn by me be subjected to Income Tax? If yes, will it be as per my current tax brackets?
Taxability of Superannuation
If an employee wants to withdraw their superannuation fund at the time of resigning from a company, the entire amount will be subject to tax. The amount will be added under ‘Income from Other Sources’ and will be taxed as per the income category the total falls under.
There are exceptions to this rule, as you will see below.
Exceptions Over Payment of Superannuation Amount
Under Section 10(13), payment of superannuation amount is not taxable under the following circumstances:
If the payment is made after the death of the employee to their heirs;
If the payment is made as refund of contributions on the death of the employee;
If the payment is made to an employee as an annuity plan after their retirement (voluntarily or due to age limit);
If the payment is made to an employee who is incapacitated by a disability or illness or other reasons
Contributions made before April 1, 1962 are exempt from taxation.
Hi sir, What is meant by “specified age” in sec 10(13) ? is it the retirement age or another age limit.
Its the retirement age only.
I have worked in a company for 7 years and accumulated 1.5 lakh superannuation fund. Now I have resigned from that company and joined a new one. Can I withdraw the full amount since my new company don’t have superannuation policy. Pls guide.
Thank you
Since the new company does not have superannuation, you can approach payroll/HR of previous employer and withdraw money as applicable
How long does it take to claim?
These days claims are processed 1 to 2 weeks time
i worked in a company for 28 years and accumulated 35 Lacs in my Superannuation account which I want to withdraw now.
I want to withdraw whole amount as soon as possible and don’t want a pension for long period.
Which option should I select?
OR
how much i can get pension?
You cannot withdraw entire amount. You can withdraw partial amount based on the eligibility. Pls approach your payroll / HR dept and they can guide you if your goal is to withdraw max amount
Why we cannot withdraw whole amount from superannuation. That is loss to the employee know, then what about the remaining amount where it will go
These are superannuation guidelines my dear friend. Balance amount one need to take annuity plan.
Sir,
I worked in a company for 9 years and accumulated 6.50 Lacs in my Superannuation account which I want to withdraw now.
I want to withdraw whole amount as soon as possible and don’t want a pension for long period.
Which option should I select?
You cannot withdraw entire superannuation. Check the eligible amount indicated in the article
Hello Sir,
I have LIC Superannuation fund with my employer. Now I want to open a NPS account and move the entire amount to my new NPS fund. Is this possible?
If yes, what will be the steps?
Hello Majumdar, If your current employer is offering superannuation, you cannot move it to NPS. You can move it only when you shift job to new employer who do not have superannuation facility / or if your company is taken over by another company who do not have superannuation. In such case, you can ask them to transfer them to NPS Tier-1 account. You need to open eNPS and provide PRAN number to your company to transfer superannuation funds.
What to do that my company trustee not certified to lic to start my superannuation
Please advise
Sir, I would like to withdraw the Superannuation amount, it was around Rs 1,20,000/- in 2008, where it can be withdrawn? I left job in India 2005 and presently working in Dubai.
Kindly request you to guide me.
You need to approach insurance company where your superannuation was invested. If you do not know the insurance company, you need to approach your previous company where you had this superannuation fund.
Sir,
I am no longer living or working in India and just left my job in India. My superannuation fund is about INR 10.5L as of now. Can I withdraw the entire superannuation fund?
Sir,
I was getting interest every month after leaving my company which stopped since last two months, what could be the reason. ( 33% commutation taken be me when I left company )
Ideally it should continue. Contact the insurance company where your superannuation is deposited and they should clarify
Sir,I need to withdraw/ closed my superannuation fund.from my previous company.what should I do and where to get the form for claim ..
Hi Suresh, nice article offering clarity. Which of the 11 options is “better”? I understand it might be relative to a person’s context, but in general, do you see one (or a few) of these options having some advantages?
It depends on your choice. Pickup the one that you like most.
I am given chance to be enrolled to DCP scheme by employer and Fund manager.I was given the forms: Intimation of death/retirement/leaving service and Mandate of pension payment and appointment of nominee. Employer says they will enroll me to the cash accumulation scheme alone while enrolling to the dcp scheme and only after superannuation I must submit these forms to any of the annuity service provider to purchase pension. I want to opt joint spouse pension, and if I demise before superannuation, then how my spouse can claim.
Hello sir,
My father is due for pension under LIC SAF and he has 2 SAF policies. This policy started in 1996 and later transferred to another plan. Now his office staff says that he will receive full withdrawal under 1 policy and will get pension for the 2nd policy however I have not seen any such information anywhere. Is it possible
There is nothing like second SAF. If he is working a company, he would have only one SAF. Based on eligible withdrawal amount, balance would be converted into pension plan. They might be talking about Part-1 Withdrawal amount and Part-2 pension amount as both different policies. You can ask your father to get the SAF details and you can verify with LIC too
Hello Sir,
I have a question related to Superannuation. I am due to superannuate later in 2022. As working in a Pvt Company, I wish to put the whole corpus of Superannuation fund into Pension. My company says, since you are going to get Gratuity, you will have to withdraw 33% of your accumulated Superannuation amount.
Can you please clarify what is the rule when Gratuity is paid when retirement? I would like to get more pension than ready cash……
Thanks
Pls read the eligible amount of withdrawal section.
At one point in above article its mentioned that withdrawal possible when an employee changes the job. It is irrespective whether the new employer is providing superannuation benefit or not. But also mention only 33% or 50% allowed based on years worked in an organization. So it’s bit confusing. I want to know can I withdraw Superannuation fund 100% during my exit from by present organization with in 1 year of starting my contribution into Superannuation fund.
How to check the amount deposited or the amount accumulated ? Also what is annuity number & how to get & what is LIC Id? I left the organization after serving 5 years, now i want to withdraw the superannuation amount. Kindly help how to proceed.
Jeevan, If you know the policy number and the insurance company, you can directly mail them or login to insurance company portal and get the amount accumulated and the returns that are getting paid.
I have worked for 9 years and i am not sure howmuch money deposited. But i moved to Nederland via internal transfer from same company. Is it possible to withdraw complete money since i will get my retirment in India?
Please advise.
No Surya. First find out how much money is there in your superannuation account. Generally if you go to onsite, your company would terminate the current employment and issue revised appointment leter in the name of new company at Netherland. In such case you can always check if you can withdraw the eligible amount or transfer such amount to NPS.
Dear Mr Suresh
I appreciate your knowledge of subject as well as the way of explanation.I also thank you in advance for getting a reply for any question from me.
Thanks Partha
Hello Sir,
I served for 4 years in my old organization and till date 6.5 lacs is been accumulated. Can’t I withdraw the complete amount by paying 33% tax on the sum accumulated and close the superannuation account. I need this amount to be invested elsewhere in property. Kindly suggest.
No Shivaji. You cannot withdraw 100% amount from superannuation. You can only withdraw eligible amount indicated in the article.
Sir , i was working for a bank where on resignation there was 10 lacs superannuation fund out of which I withdrew 30 percent . Balance 6.5 lacs was put in hdfc life pension plan . Now due to some emergency i need to withdraw this fund . Is it possible. Or atleast a loan against this fund , is it possible. Please clarify . I am currently unemployed in any corporate.
No. You cannot close pension plan and get your purchase price once taken. Some pension plans offer repayment of purchase price in case of critical illness. Some plans offer loan against pension plan, however the interest would be higher than what they are paying. You can go through your pension plan T&C to know more info as these would depend on which HDFC pension plan you have taken.
Who has to make the request for superannuation account closure after resignation from a company, is it the Employee or employer? Can an employee make the claim without employer consent after resignation?
Vijay, If you know where your superannuation fund is and policy details you can directly approach the insurance company (e.g. LIC). If you do not have details, you need to reach your previous company – HR / Payroll team and ask for withdrawal. They would inform respective insurance team.
I received 1/3 rd withdrawal amount. But it is less by 1.5 lac than calculation. I yet to get calculation from LIC. Any suggestions from you as to why it is less. Apprx. 25% less received.
Only LIC can clarify as to why they paid to you less. From your side, you can check what is the total contribution till date with returns and compute 1/3rd of it. If you have received less than this, you need to approach LIC about computations.
Sir I have worked in a company named A H P Manufacturing B V
This company paid superannuation to Lic, Chennai with our name. After my completion 7 years service, they sold the company to Pfizer. Pfizer has no this policy. Again Pfizer sold to Zoetis. When I tried to claim my fund, Zoetis HR told they don’t know trustee name of the AHP company. But Lic, Chennai people sent formats to be signed by the trustee. Please guide me what I have to do If trustee is not traced.
Hello VVN, I have observed this situation several times. Pls approach LIC itself and ask them to provide trustee name and then approach your current company which was taken over through pfizer. In majority of the cases, your local HR would not be aware of it. You need to approach your payroll department who would be signing authority of such trustee.
Dear sir
My existing company i had Superannation Fund. to purchase annuity plan what are the best company available to take the annuity for the Superannation fund. or is it that employer dependent they might linked with some company and i need to buy for annuity plan ?
Note: after selecting the check box for follow up notification mail am not getting any mail once your reply posted. But for new post am getting the intimation through email…i verified the spam box also.
Hello Veera, You need to check where your company has taken superannuation. e.g. if they have taken at LIC, generally you need to consider it in LIC only. But I would suggest check with your payroll and find out which insurance company they have taken superannuation. There is no plain answer for “Best annuity” as it depends on number of factors like immediate annuity or deferred annuity, no of years, whether you are opting for return or purchase price or not etc.,
Hello Suresh
i have received a letter from LIC with annuity number & policy number they have sent it to call for existence certificate , i have noi udea regarding the super annuation can yi kindly guide me through this.
Regards
Raghavendra Rao
Raghavendra, Generally there is no such intimation from any insurance company / trust where your employer might be maintaining superannuation fund.
1) Pls check whether it pertains to one of your insurance policy.
2) If this pertains to your superannuation fund only, first reach out to your employer. If you have already resigned and came out of employment from the company where you had superannuation, then you need to submit documents as per what LIC is asking
3) I would recommend you to move superannuation fund to your NPS Tier-1 account (you can approach LIC for this for documentatio0n) so that this would be in your control to manage
Hello Mr Suresh
I have been getting payment from Superannuation Fund from the year 2008.
Now, it’s 13 years.
In the beginning, a portion was commuted.
Like in Pension of Provident Fund, can the commuted portion of Superannuation be added back?
If yes, after how many years?
As I’m 63 years of age now, can I withdraw the entire Superannuation amount?
Thanks & Regards
How much and how can I withdraw amount from superannuation If I am moving abroad on PR Visa.
Please help
Rajesh, Pls read the article about eligible amount to be withdrawn.
Hi Suresh,
I was working in a MNC in Mumbai,India where Superannuation was part of my CTC , but I was told to take early retirement by the Company after completing 9 years in service. But now the company has informed me that I am eligible for only 50% of the accumulated Superannuation corpus & have been paid accordingly. As per the company the Superannuation rules :
1) If you have not completed 5 years of service then no superannuation shall be paid by the company.
2) If you have completed 5 years or more but less than 10 years then only 50% of the Superannuation amount(corpus) accumulated shall be paid.
3) If you have completed 10years or more then 100% of the Superannuation amount accumulated shall be paid.
But since I have completed 9 years of service in the company ,the company has put me in the category 2) above as I have not completed 10 years of service. I just wanted to know from you whether there are any such categories in Superannuation policies as mentioned above ,and is the company doing the right process of payment. In fact I am requesting the company to pay me complete 100% , since the company had told me to take early retirement . Kindly reply with proper clauses ,facts etc so that I can take up with the company. Thanks….MLS
Hello Madhav, The guidelines what you indicated does not pertain to Superannuation. These are your employer own policies.
Hi Suresh,
I was part of retrenchment process in a pvt co and threatened to resign
I Worked for 17 years. Now that I am sixty I requested the country regarding my superannuation fund and was I formed that I am not eligible as I did not complete 20 working years. Your advise please
Hello BMK, Superannuation fund is part of the CTC of the employee. This amount is deposited in group superannuation fund with any of the insurance companies like LIC or ICICI Pru life etc., Employees are provided with their superannuation policy number too. You need to check wehther it was part of your CTC and if yes, was there any policy number given to you. If this is not part of your CTC, then you would not get it.
sir,
I have left the job from Ltd. company and, my superannuation fund is in LIC, i want to withdraw my superannuation fund. can you guide me.
Hello Shah, If you have superannuation policy number, you can approach LIC directly. If not, you need to approach the company payroll department who can help you with these details. You can read out article about eligible withdrawal and balance you need to take pension plan.
My 80C is already full with home loan principle amount and PF amounts. Is the superannuation part of the same 80C or in addition to 80C tax benefits?
Contribution towards approved superannuation fund is exempted u/s 80c up to Rs 1.5 Lakhs
Dear Suresh, Thanks for taking effort to publish this. Very useful to novices like me without much knowledge with Tax and Pension systems.
Would request your valuable advice in the below. Kindly suggest best options here:
Thanks in advance !
1. I am resigning my job with an MNC in India after 19 years and moving to UK.
2. I am 50+ and do not have plans to work for an Indian company
3. I do not have opted for NPS, or not planning to explore further.
4. Would like to have immediate maximum lumpsum payment as my retirement plans will be in UK
My Superannuation fund is managed through ICICI Prudent Life and I see the below options:
A. Select Appropriate Options below:
a. 2/3 of value of units to be utilized for immediate pension thru iciciprulife, 1/3 of value units to be paid in lumpsum (commutation)
b. 1/2 of value of units to be utilized for immediate pension thru iciciprulife, 1/2 of value units to be paid in lumpsum (commutation)
c. 100% of value of units to be utilized for immediate pension thru iciciprulife
B. Details for Immediate Pension (asking for bank Account Details etc.)
C. Annuity Payments
– Frequency of Payments (Monthly, Quarterly etc.)
– Annuity Options (Life Annuity, Life Annuity for 5 years and life thereafter etc.)
– Bank account details
In superannuation (like NPS), you cannot take 100% withdrawal. You can take lumpsum as indicated by you and balance take a pension plan. This is biggest drawback of NPS or superannuation plan. I would recommend you convert this from superannuation to NPS
1) You can open NRE/NRO and provide this bank for pension plan. 2) In case of NRE account, you can repatriate the funds from your Indian NRE bank account to UK bank account (where you are planning to retire)
you can do this process directly with superannuation too, but pls talk to ICICI Life insurance before you proceed as I heard the process is more complex. If it simpler, you can directly take pension from superannuation fund directly to NRE account
Thanks Suresh for the detailed suggestions. Really appreciate it…
1. I assume I can opt for ‘1/3 of value units to be paid in lumpsum (commutation) only’ – as I completed 5+ years in the company I am leaving. Or can I opt for 2/3rd as lumpsum?
2. Since I still have India Bank Account active. Also NRE/NRO accounts. I am a bit concerned with complexities of transfer to NPS etc. I will keep the balance with ICICIPrulife itself and opt for Quarterly payments. Will that be ok ?
1) Check the rule, it is only 1/3d 2) You can opt for pension plan. In case you don’t want pension now, you can move to NPS and then it is under your control, instead of retaining in superannuation fund which would be in MESS.
Hi Suresh, I worked for a company based out of India and have been living in US for a while now and I have settled here. My Superannuation fund is still with my organization. Since I do not pay Tax in India, what are my options to withdraw. Are there other options (not annuity based) available for people who do not have Indian citizenship any more?
Request your advise.
Hello Ms, There are no separate guidelines for NRIs. You can approach the company where you had superannuation and consider taking an annuity / Transfer this to NPS Tier-1 and later take annuity.
Hi Suresh,
I am working in a company for more than 7 years, and have opted to pay monthly contribution, which I paid for around 4 years. I am still working with same company but got assignment outside India so have been moved to different country payroll, and therefore, my contribution is discontinued since last year. In past, I had registered myself on LIC website, where my company has group policy, but as of now, i don’t see that online. (https://customer.onlinelic.in/GroupPensionUser.htm is down) I do have my policy number and my company website is showing funds for my policy. Can I request your help to know the way to transfer my superannuation fund to my NPS account? Can i get that transferred before my retirement or resignation ? Please provide your guidance. Thanks
Nailesh, I have personally transferred my superannuation fund to NPS. There are certain conditions for that. It can be done when one has resigned / during retirement. Since my company has taken over by some other company, there was an option for me to move it. But in your case since you moved to onsite there could be an option, but I am not sure.
1) Pls talk to your company payroll whether you can transfer superannuation to NPS (as you moved to onsite and there are no contributions now in SA).
2) If yes, you need to check with your NPS point of contact (e.g. for me I Opened in ICICIdirect and they are my contacts) and ask for documentation. The process is tedious, but it is one time
3) Once you fill the documents, get it signed with your payroll, you need to share with NPS team
4) They would verify and confirm
5) You can ask your payroll team to transfer superannuation fund to your NPS account
6) This would take 3 to 5 working days post all confirmations by both these teams
This is tedious job, but still I have another 14+ years for retirement, I don’t want someone to control my funds. NPS is in my control, hence this step helped me to track it.
Pls let me know if any of the above steps helped you or you had any additional steps to be done
Thanks for valuable information. If we retain the amount in superannuation fund after change in job. what happens to the amount? will interest be paid and amount accumulated till retirement age?
Hello Satish, The insurance company (where your superannuation fund) is accumulated would keep investing based on their investment objective (e.g. like NPS). This would continue to earn returns though not guaranteed till you convert them into pension plan / withdraw.
Sir,
I have recently opted for VOluntary retirement from a MNC. I am 59 years and 7 months old. What should I do with my Employee PF amount ? Should I withdraw and reinvest elsewhere or leave it in the EPF account.
Hello Shyam, If you don’t need money for few more years, you can leave it so that you can earn higher interest rates compared to other investment options.
Dear Sir,
I have superannuation fund almost Rs. 10L in LIC, I want withdrawn it, I do not want annuity. Please suggest how to withdraw?
There is no way you can withdraw this 100%. You can withdraw as per guideline and balance take a pension plan. Alternatively you can move it to NPS and track online and take pension plan lateron.
Dear Sir,
What tax slab will be used to withdraw before retirement.
This would depend under which circumstances the amount is withdrawn. Here are the scenarios.
1) Amount withdrawn if any by the employee at the time of change of job is taxable under the head “Income from other sources”
2) Any benefit received from superannuation fund on death or injury are tax free
3) On retirement, 1/3 of the commuted fund is fully exempt from tax and the remaining amount if transferred to an annuity is tax-free and if the amount is withdrawn, it is taxable in the hands of the employee.
Hello Sir ,
If you select Annuity option as (Life Annuity guaranteed for 5) – Quarterly/Yearly Pension to understand on how the taxation works on this pension …
Sir. My employer giving that option. Maintained by LIC. But I’m forced to get annuity only from LIC. There’s no option to choose different provider or shifting to NPS. What should we do here? Request suggestion
Hello Sivaraman, I agree which is major concern. There is one alternative only when you resign. You can opt your superannuation fund to be moved to NPS. In such case you can open NPS (if you have not have one) and then move these funds. However this option is available only when a person either resigned and moving out and on retirement when we need to consider withdrawal. You can approach your payroll / HR if you fall in these categories
Sure. But my finance team is saying LIC is only option. NPS transfer they’re trying but not approved as of now
You should try that NPS option. I am personally trying and it should happen in next couple of weeks.
Ok. Thanks for the information. When it’s time let me try
How do I check if my employer is contributing to the superannuation fund?
Pls approach your payroll / HR department and ask for superannuation company where they are investing + policy number. With this you can approach that insurance company and find out superannuation balance