New pension scheme or the old pension scheme (NPS vs UPS), which is the better option to go with? This question has remained for months now and quickly, the consumers have to find the suitable answer. The Central Government of India has extended the time limit to chose one pension between those two schemes. This article is to inform you that the new pension scheme has 3 features that are not in the old system.
The government had implemented UPS from 1 April 2025. Initially, the employees were given time till 30 June, which was later extended till 30 September. But recently provisions like switch option, benefit on voluntary resignation or compulsory retirement, tax exemption have been added in UPS.
Pensions have always been a politically sensitive issue. There have been protests in several states demanding the reinstatement of the Old Pension Scheme (OPS). The government presented UPS as a middle ground between OPS and NPS. Now, extending the deadline has given the government an opportunity to convey that it is listening to employees’ concerns. Following this, PFRDA has been instructed to make changes to the CRA system and regulations. This means that in the coming days, employees will have a more convenient digital system for choosing the UPS option.
3 benefits which are not in the old pension scheme system:
Media reports claimed that thousands of employees were unsure whether to stay with the old system or opt for the new UPS. The new changes have made UPS more attractive. These three changes include:
1. Switch option – Employees can switch between UPS and NPS in the future if they wish.
2. Tax benefits – Tax exemptions have been clarified in the new provisions.
3. Retirement security – Pension security is guaranteed even in cases of resignation or forced retirement.