Both NPS variants help you save for retirement—but the way they work (and save you tax) differs. Here’s how to choose the one that fits your career and financial goals.
Both offer tax-saving benefits and help grow your money through market-linked returns. But depending on whether you’re salaried, self-employed, or an NRI, the better option could vary.
Let’s decode how each model works and what it means for your long-term financial planning.
Individual NPS—also known as Retail NPS—is open to all Indian citizens and NRIs aged 18 to 70. Whether you’re salaried, self-employed, a freelancer, or an NRI—you can enrol voluntarily and start building your retirement fund.
This model gives you the flexibility to:
Great for: Those who want full control of their retirement planning and tax savings without relying on employer-linked benefits.
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Corporate NPS is an employer-led model designed specifically for salaried individuals in registered organisations. In this setup, your employer offers NPS as a workplace benefit—and may even contribute a portion of your salary to it.
Here’s what makes it unique:
Ideal for: Salaried individuals whose companies are registered under the Corporate NPS model.
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| Feature | Individual NPS | Corporate NPS |
| Who can invest | Any Indian citizen or NRI (18–70 yrs) | Employees of NPS-registered companies |
| Tax Benefits | Up to Rs. 2 lakh (80C + 80CCD(1B)) | Employee: Same as Individual Employer: Extra under 80CCD(2) |
| Contributions | Voluntary | Employee + Employer |
| Control | Full control by investor | Shared responsibility with employer |
| Registration | Self-enrolment | Through employer |
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Both Corporate and Individual NPS subscribers can open:
This is your core retirement account with tax benefits. It comes with a withdrawal lock-in until retirement (age 60), and partial withdrawal is allowed under specific conditions. On maturity, 60% of the corpus is withdrawable; the remaining 40% must be used to buy an annuity.
This is an optional savings account. It has no lock-in, no tax benefits (unless you’re a central government employee), and works like a mutual fund with flexible withdrawals.
Quick Tip: Tier I = Retirement planning | Tier II = Extra savings
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Your choice depends on how you’re employed and what level of control you want.
Remember, both options invest in a mix of equity and debt to give your retirement fund the power of long-term compounding.
Also Read: NPS Returns for Tier 1 & Tier 2
Both Corporate NPS and Individual NPS are excellent retirement planning tools—but serve slightly different purposes. Individual NPS gives you complete control and flexibility, while Corporate NPS provides added tax efficiency and employer support.
You can even have both, depending on your employment journey. The key is to start early, stay consistent, and explore safe, stable options like Fixed Deposits alongside your long-term market-linked investments. Check latest FD rates offered by Bajaj Finance and start investing now!
Calculate your expected investment returns with the help of our investment calculators
Use our simple and powerful investment calculators to estimate your NPS returns and make informed financial decisions. Plan your retirement strategy more effectively by forecasting corpus value, monthly pension, and tax benefits using accurate inputs tailored to your income and contribution levels.
Yes, corporate NPS is considered a beneficial investment option as it helps employees build a long-term retirement corpus while also offering attractive tax benefits. In addition, it provides exposure to market-linked returns, which are usually higher compared to traditional savings instruments like PPF or fixed deposits.
No, you cannot convert a corporate NPS account into an individual NPS account on your own. Any change in account type must be facilitated by your employer or handled through the Central Recordkeeping Agency (CRA) as per NPS guidelines.
No, you cannot hold both an individual and a corporate NPS account at the same time. NPS regulations allow only one active Permanent Retirement Account Number (PRAN) per subscriber, irrespective of the mode of enrolment.
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