The government has made changes to the Atal Pension Yojana‘s (APY) rules. Now, from October 1, 2022, any citizen who is or has been an income taxpayer will not be eligible to join the pension scheme. If an income tax-paying investor joins the APY scheme on or after October 1, the APY account will be liable to be closed, according to a notification from the finance ministry.
“From October, 1, 2022, any citizen who is or has been an income-tax payer, shall not be eligible to join APY… In case a subscriber, who joined on or after October 1, 2022, is subsequently found to have been an income-tax payer on or before the date of application, the APY account shall be closed and the accumulated pension wealth till date would be given to the subscriber,” the notification said.
Till now, all citizens of India between the age of 18 and 40 years were eligible to join the scheme, irrespective of their tax-paying status. Under the scheme, the Centre contributes 50 per cent of the subscriber’s contribution or Rs 1,000 per annum, whichever is lower. The government co-contribution till now available for those who are not covered by any statutory social security schemes and is not income taxpayer.
The Atal Pension Yojana, announced in the Budget 2015-16, is a central government scheme for income security in the old age and is focused on all citizens in the unorganised sector. It is administered by the Pension Fund Regulatory and Development Authority (PFRDA) through the National Pension System (NPS) architecture.
Under the scheme, there is a guaranteed minimum monthly pension for the subscribers ranging between Rs 1,000 and Rs 5,000 per month. The benefit of the minimum pension will be guaranteed by the government.
Exit From The Atal Pension Yojana Scheme
In case of death of the subscriber due to any cause: In case of death of subscriber, pension will be available to the spouse and on the death of both of them (subscriber and spouse), the pension corpus would be returned to his nominee.
On attaining the age of 60 years: The exit from Atal Pension Yojana is permitted at the age with 100 per cent annuitisation of pension wealth. On exit, pension would be available to the subscriber.
Exit before the age of 60 years: Exit before 60 years of age is not permitted. However, it is permitted only in exceptional circumstances, i.e., in the event of the death of beneficiary or terminal disease.
Last year in October, it was allowed to open Atal Pension Account online. The PFRDA through a notification said the process can be done online. It added that in order to simplify the process to enroll in the Atal Pension Yojana, the government has added the option of Aadhaar eKYC whereby citizens can subscribe to the scheme.