If a employee contributing to NPS changes his job, what will happen to his NPS account? This article explains how to transfer NPS when one shifts office. It explains various sectors of NPS,Nodal Office, Shift from EPF to NPS, Shifting NPS using Form ISS.

NPS account is portable

NPS is a pension system which offers financial security after retirement to a person. During the service life of an employee, only one NPS account is maintained irrespective of change of employer. You can shift from one sector to another,from one State Government service to another State Government service, from Central Government to Corporate and vice-versa etc.  So, if you opened account as Central Government Employee and quit your Government Job, you can still continue under All Citizens model by making contribution of Rs 1,000 to keep your NPS account active. You do not have to quit NPS when you quit your job or shift to an employer which does not offer NPS.

Permanent retirement account number (PRAN) is a unique number allotted to a National Pension System (NPS) subscriber. PRAN or the account is portable and can be moved even if a government servant moves to the private sector.  You can have just 1 PRAN just like you can have only one Permanent Account Number(PAN). So You can use the same PRAN across different Government departments, state governments, employers or even after changings job. 

Various sectors or Models of NPS

Let’s go over the sectors or the models of National Pension Scheme. Currently, NPS and APY together have more than One Crore subscribers with total Asset Under Management (AUM) of more than Rs.1 lakh crore.

• Government Sector:
  • Central Government : From 1 Jan 2004  Government made it  mandatory for new  government employees (except armed forces) to contribute to National Pension Scheme with matching contribution by government
  • State Government: NPS is applicable to all the employees of State Governments, State Autonomous Bodies joining services after the date of notification by the respective State Governments.  All state governments gradually adopted the NPS.  Tamil Nadu had signed to shift their employees to the NPS in April 2003, Maharashtra signed up in November 2005,Kerala finally agreed to join the NPS from 2013-14.
• Corporate Sector: Corporate National Pension Scheme (NPS) was launched in December 2011 by PFRDA (Pension Fund Regulatory Authority). Just like a Provident Fund, NPS is a contribution scheme through which both the employer as well as the employee can build the employees’ pension wealth.   The biggest advantage is the tax benefit up to 10% deduction on the Basic Pay+DA of the employer’s contribution on behalf of the employees. This is over and above Rs 1,50,000 benefit under Section 80 C, which is applicable to the employee’s contribution to the NPS kitty. Even the employer can claim tax benefit for its contribution by showing it as business expense in the profit and loss account.
• All Citizens Sector: NPS has been made available to every Indian Citizen from 1st May 2009 on a voluntary basis. All citizens of India between the age of 18 and 60 years as on the date of submission of his application to Point of Presence (POP) / Point of Presence-Service Provider (POP-SP) can join NPS.
• NPS Lite or APY or UOS( Unorganized sector)
  • NPS Lite or The Swavalamban Scheme is to provide the retirement benefit  for unorganized sector. Under this scheme, the Govt. of India will contribute Rs.1000 per year,for 5 years, to every NPS-Swavalamban account provided the contribution is between Rs.1000 to Rs.12000 per year.  The people forming part of this low income groups will be represented through their organisations known as Aggregators who would facilitate in subscriber registration, transfer of pension contributions and subscriber maintenance functions. Subscribers in the age group of 18 to 60 can join NPS – Lite through the aggregator and contribute till the age of 60.
  • From Jun 1 2015 Atal Pension Yojana (APY), replaced Swavalamban Yojana NPS Lite. The existing subscribers of Swavalamban Scheme were automatically migrated to APY, unless they opt out. We have covered the scheme in detail in our article Atal Pension Yojna

What is Nodal office of NPS?

PFRDA has appointed National Securities Depository Limited (NSDL) as the Central Record Keeping Agency (CRA) to maintain the records of contribution and its deployment in various pension fund schemes for the employees.  The records of the contribution of each employee will be kept in an account known as the Permanent Retirement Account which will be identified by a Permanent Retirement Account Number (PRAN).

Government offices like DTO and DDO or offices equivalent thereof which will interact with CRA on behalf of the Subscriber are collectively referred as Nodal Office. CRA-FC is Facilitation Centre appointed by CRA to facilitate Nodal Offices to submit applications for allotment of PRAN and application for change in signature and photograph of the subscriber

• Nodal offices  under Central Government include the Principal Accounts Office (PrAO), Pay and Accounts Office (PAO) and Drawing & Disbursing Office (DDO) under the Central Government or analogous offices .
• Nodal offices under the State Government include the Directorate of Treasuries and Accounts (DTA), District Treasury Offices (DTO) and Drawing & Disbursing Office (DDO)  .

Nodal Offices are identified by a unique number, i.e., Pr.AO /PAO/ DDO registration number that is allotted to them by the CRA on successful registration.

Can I shift my NPS account to eNPS?

Unfortunately, you cannot port your NPS account to eNPS i.e. eNPS cannot be your target PoP when you are shifting. You must open account using eNPS portal for it to be your PoP. But you can contribute using eNPS.

On Shifting Jobs

Our parents(mostly fathers) worked in the same or at most two jobs in one career, they retired on their provident funds. But now people hop from one job to the other looking for better and lucrative job opportunities. But to ensure a smooth financial transition one needs to take care of our salary bank account, Tax computation, Employee Provident Fund(EPF), Health insurance etc. Our articles Changing Jobs:Take Care Of Bank Account,Tax Liability focuses on exploring what to do with Salary Bank Account, Tax liability when ones switch jobs.

Changing jobs often leads to a situation where an individual gets tax exemptions twice from his earlier employer as well as from his new employer. Exemptions and Tax Liability form an important consideration while switching jobs. Making a job switch in the middle of the year involves making sure that the deductions and exemptions regarding tax liability are made only once. Our article Changing Jobs and Tax, Form 12B explains it in detail.

Shifting from EPF to NPS

The proposal to switch from EPF to NPS was announced in 2015 budget.  A legislation to amend the Employees’ Provident Fund & Miscellaneous Provisions Act has already been framed and is lying with the Law Ministry. Till the move becomes reality one would either have to withdraw money from EPF or let EPF account continue without any contribution and let EPF will earn interest.

The amendments allows EPF subscribers to make a one-time switch to the NPS. Within 30 days of applying, the entire balance in his EPF account will be transferred to the NPS. Opting for the NPS would also mean the individual exits from Employees Deposit Linked Insurance as well as the Employees’ Pension Scheme (EPS). The Bill is silent on what this means for the amount mandatorily deducted from the employer’s contribution and put into the EPS.
But the best part about the proposal is  , the employee will have a one-time chance to return to the EPF fold. However, on rejoining the EPF, the subscriber will be treated as a new entrant and will not be eligible for benefits he might have accumulated in his previous tenure in the EPF. Also, after this ghar wapsi, the subscriber will not have the option to go back to the NPS.

Shifting NPS within the Central Government/ a State Government

In case a subscriber shifts within the Central Government or a State Government then there is just change of Nodal office i.e. from one PrAO/DTA/PAO/DTO/DDO or to another PrAO/DTA/PAO/DTO/DDO then the subscriber need not submit any separate request. For shifting of NPS within Government sector, the Subscriber is required to intimate his PRAN to the target (new) office with whom he/she will be associated after shifting. The new office will facilitate shifting in the CRA system by uploading the NPS contribution. PRAN will get associated to new office in the CRA system on successful credit of the monthly NPS contribution. Subsequently, the new office is required to update Subscriber’s employment details in the CRA system.

Shifting NPS using Form ISS

A subscriber can shift from one sector to another sector or from one office to another office with the same PRAN e.g. from Central Government (CG) to State Government (SG) or from one department to another, etc. For most of the cases when one needs to Shift NPS one needs to submit  Inter Sector Shift (ISS) Form . It can be downloaded from npscra.nsdl.co.in or Click Here or you can get it from an existing point of presence of the service provider (POP-SP).

• Fill in complete details of the shift you are making ex: from State Govt to State Govt or from Govt to Corporate etc, discussed in detail later.
• Attached appropriate documents
• Form with supporting documents has to be submitted to target POP -SP.
• A stamped acknowledgement is given.
• Once details are verified, the change is communicated to the subscriber.

Before shifting Please note

• PRAN should be active.
• Details such as PRAN number, employer information and salary information must be filled correctly as these are recorded in the NPS system.

Shifting NPS Form ISS (Inter Sector Shift)

One must submit Form ISS-I. It can be downloaded from npscra.nsdl.co.in or Click Here   or you can get it from an existing point of presence of the service provider (POP-SP).

• Name and address, PRAN details, details of the existing and new POPSP need to be provided in the form.
• Please quote the correct PRAN and attach a copy of the PRAN Card
• Please provide Details of the DDO / POP-SP with which the PRAN is currently associated.
• Please provide Details of the DDO / POP-SP with which the PRAN will be associated.
• Sector for ‘Existing PRAN association’ and ‘Target PRAN association’ can be the same only if a subscriber is shifting from one State Government to another State Government

Declaration to be filled by subscribers across all sectors.  On successful verification of the change request form, POP-SP shall accept the same and shall issue a 17 digit Receipt Number  as an acknowledgement to the subscriber. The nomenclature of the receipt

• First 2 digits (from left) – Type of request (19 for Subscriber shifting)
• Next 7 digits – Registration Number of POP-SP e.g., 6000002
• Next 8 digits – Running sequence number eg.00000001
• For Example: 17 digit receipt number will be “19600000200000001”

POP-SP shall handover the acknowledgement to the subscriber as receipt of the acceptance of the request. The POP-SP shall affix the seal as well as the user shall sign the acknowledgement before providing the same to the subscriber.

Instructions and Documents that one needs to provide are shown in image below:

Shifting NPS Between State Government and Central Government

For shifting PRAN from one sector to another or from one State Government to another State Government, the subscriber is required to submit Form ISS-1 to the target Nodal Office i.e. to the Nodal Office with whom he/she will be associated after shifting. The target Nodal Office initiates the shifting of PRAN along with accumulated NPS contributions under the PRAN in the CRA system.

• Download Form ISS-1(Inter Sector Shifting form). To Download Click Here  
• Fill in complete details and attach documents
• Submit the form to your Target Nodal Office (i.e. Pay & Accounts Officer/ Drawing & Disbursing Officer)

Shifting NPS to Central Government or State Govt

Subscribers shifting to central /state government need to furnish employment details including salary and department involved. The information needs to be attested by employer. Bank details have to be provided with cancelled cheque.

The Government of India or a Government of States in India classifies public employees into Group A (Gazetted/Executive), B (Gazetted), B (Non-Gazetted), C and D. This classification is based on the recommendations of 6th CPC.

Shifting NPS to UOS or Citizen Sector

In case, the subscriber is shifting from UOS to Central or State government, the process remains the same as in Shifting NPS Between State Government and Central Government. Internally The Swavalamban Flag (even if already activated) will not be applicable in Government Sector. Image below shows additional information required when one needs to Shift NPS to Citizen or Unorganised Sector.

Shifting NPS to Corporate Sector

The subscriber will submit the duly filled form for shifting along with a copy of the PRAN card to the target POP/POP-SP. Image below shows additional information required when one needs to Shift NPS Corporate Sector.

• Subscribers have to provide employment, bank and PAN details.
• They also have to choose PFM and investment option.

Related Articles:

• Understanding National Pension Scheme – NPS
• eNPS : Open NPS account online, contribute to NPS online
• Should you Invest in NPS the National Pension Scheme for additional 50,000 and save tax
• Saving For Retirement : Pension Plans,NPS,EPF,PPF
• Tax saving options : 80C,80CCC,80CCD,80D,80U,80E,24
• Tax Planning Traps To Avoid
• Returns of NPS