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Unified Pension Scheme
The Unified Pension Scheme (UPS) is introduced by the Central Government as an option under the National Pension System (NPS) for Central Government employees with effect from 1st April 2025. The UPS provides assured pay-out based on the prescribed conditions.
The UPS was notified by the Department of Financial Services, Ministry of Finance, under notification F. No. FX1/3/2024-PR, dated January 24, 2025. Subsequently, PFRDA issued the UPS Regulations, 2025, on March 19, 2025, to operationalize the scheme. These regulations extend specific benefits to eligible NPS retirees and their spouses, supplementing the benefits already accrued under NPS, including annuity payouts.
By offering a one-time lumpsum payment, monthly top-up amounts, and interest on arrears, the UPS complements existing NPS benefits. Eligible retirees and their spouses are encouraged to act promptly within the claim period (April 1, 2025, to June 30, 2025) and utilize the resources provided by PFRDA to ensure a smooth claim process.
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NPS vs UPS Calculator: New tool for Government employees; Compare NPS and UPS for higher retirement benefitsThe following UPS benefits are available to such subscribers/their legally wedded spouses. These benefits are available in addition to the benefits availed or accrued to such employees under NPS including annuity.
Lumpsum payment (one-time)
A one-time lumpsum payment equivalent to one-tenth of the last drawn basic pay plus dearness allowance (DA) for each completed six months of qualifying service. This amount is payable as of the date of superannuation, voluntary retirement, or retirement under Fundamental Rules 56(j), as applicable.
Monthly top-up amounts
A monthly top-up amount is calculated as follows:
Admissible UPS payout + Dearness Relief (DR) – Representative annuity amount under NPS.
This ensures that retirees receive a supplementary pension to bridge any gap between NPS annuity payouts and UPS entitlements.
Simple interest on arrears
Simple interest, calculated at the applicable Public Provident Fund (PPF) rates, will be applied to arrears for the above benefits for the past period.
How to claim UPS benefits:
Physical mode
The subscriber or spouse, as appropriate, must deliver the completed relevant Form (B2-for the subscriber and B4/B6-for the legally married spouse) to the relevant Drawing and Disbursing Office (DDO) where the subscriber has retired.
Online mode
The subscriber or the spouse need to visit www.npscra.nsdl.co.in/ups.php and fill the online form and submit the same through online mode to DDO for their processing.
When is the last date to claim UPS benefits?
Timelines to claim the benefits are from April 1, 2025 to June 30, 2025.
FAQs on Unified Pension Scheme (UPS) Benefits for NPS Retirees
1. Who is eligible for these UPS benefits?
Only Central Government employees who retired under the NPS on or before March 31, 2025, and completed at least 10 years of qualifying service, are eligible. Their legally wedded spouses are also entitled to claim the benefits.
What benefits are offered under the UPS?
Eligible retirees and/or their spouses will receive:
A one-time lump sum payment based on last drawn pay and DA.
A monthly top-up amount to supplement NPS annuity.
Interest on arrears, calculated using the applicable PPF interest rates.
How is the one-time lump sum calculated?
The lump sum is equal to one-tenth of the last drawn basic pay + DA for each completed 6 months of qualifying service at the time of retirement.
What is the monthly top-up benefit?
It is the difference between the UPS pension entitlement (plus dearness relief) and the annuity received under NPS. This amount is paid monthly.
Are the UPS benefits in addition to NPS pension and annuity?
Yes. These are additional benefits on top of what is already received through the NPS, including the annuity.