Unified Pension Scheme (UPS)

1. Provides financial support to the spouse or dependents of the pension holder in case of their death 

1. Regular updates on account balances and investment performance 

1. Allows partial withdrawals at retirement age 

1. Employees can maintain their pension accounts even if they move to different regions 

Eligibility Criteria for Unified Pension Scheme 

Given below are the eligibility criteria for joining the UPS: 

1. Applicant must be above 60 years to qualify for the pension 

1. Applicant must be citizen of India 

1. Employees who have fulfilled at least 10 years of service qualify to receive a pension under the Unified Pension Scheme.  

1. The complete benefits of the scheme, along with the guaranteed pension, will only be accessible to individuals who have completed 25 years of service.  

1. Current employees under the National Pension Scheme (NPS) or those selecting the Voluntary Retirement Scheme (VRS) will have the choice to switch to UPS or maintain their current pension schemes. 

1.  Future employees will similarly have the option to select Unified Pension Scheme; if an individual decides to opt out of UPS, they will not have the ability to change their decision. 

Unified Pension Scheme Minimum Pension Amount 

The Unified Pension Scheme provides a minimum monthly pension of Rs.10,000 for government employees who retire after completing a service period of no less than 10 years. 

Benefits of Unified Pension Scheme 

Below are the benefits of Unified Pension Scheme: 

1. Guaranteed Pension: Ensures a fixed monthly income post-retirement 

1. Fixed Returns: Offers predictable and stable returns 

1. Tax Benefits: Contributions are eligible for tax deductions under section 80C 

1. Lifelong Income: Provides income for life, ensuring financial security 

1. Flexibility: Allows partial withdrawals in case of emergencies. 

Unified Pension Scheme Returns 

The Unified Pension Scheme guarantees a set of pension amounts for government employees once they retire. Employers will contribute 18.5% of the basic pay along with the allowance, and employees will contribute 10% of that amount. 

For employees who retire after at least 25 years of service, the pension will be 50% of their average basic pay earned in the 12 months of their retirement. Employees who retire after a minimum of 10 years of service will get a monthly pension of Rs. 10,000 after retirement. 

Key Difference between UPS (Unified Pension Scheme) and NPS (National Pension Scheme) 

The below table provides the difference between UPS and NPS: