Income tax payers barred from enrolling in Atal Pension Yojana from October 1

Income tax payers barred from enrolling in Atal Pension Yojana from October 1

The new notification will not apply to subscribers who have joined or joins the scheme before October 1, 2022

BUSINESS DESKUpdated: Thursday, August 11, 2022, 10:50 PM IST
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Income tax payers barred from enrolling in Atal Pension Yojana from October 1 | ANI Photo

Mumbai: The Finance Ministry has significantly modified the eligibility criteria for enrolling into the Atal Pension Yojana (APY), and notified that income tax (IT) payers will not be allowed to join the scheme from October 1. The notification will not apply to subscribers who have joined on or before September 30, 2022.

The much-hyped social security scheme was introduced by the NDA government on June 1, 2015 as a social security measure for the unorganised sector but was kept open to all Indian citizens.

Currently, everyone in the 18-40 age group can join APY through banks or post office branches where one has a savings bank account. The subscribers of the scheme get a minimum guaranteed pension of Rs 1,000 to Rs 5,000 per month after attaining 60 years of age depending on their contribution.

The new notification has clarified that the APY account will be closed for IT payers who join the scheme on or after October 1 and their accumulated pension wealth will be returned to them.

As per the scheme, the government shelled 50 per cent of the eligible subscriber’s contribution or Rs 1,000 per annum, whichever is lower, for APY accounts opened between June 2015 and March 2016. However, it is subject to the condition that the subscriber is not a beneficiary of any other social security scheme and also not an income tax payer.

The latest Finance Ministry data shows that more than 99 lakh APY accounts were opened during the last fiscal, taking the total number of subscribers to 4.01 crore at the end of March 2022.

India currently has about 8.22 crore IT payers, which includes individuals and corporates. Under the IT law, people with taxable income up to Rs 2.5 lakh are exempt from tax or not required to pay tax on their income.

(with inputs from agencies)

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