NPS for NRIs & OCIs: A Complete Guide

The National Pension System (NPS) is available to Non-Resident Indians (NRIs) and Overseas Citizens of India (OCIs), offering them a structured retirement savings option in India. Eligible NRIs and OCIs can open an NPS account if they are between 18 and 85 years old, hold a PAN, and have an NRE or NRO bank account.

What are the eligibility criteria for NRIs and OCIs?

To open an NPS account, NRIs and OCIs must meet specific eligibility criteria.

1. The applicant must be between 18 and 85 years of age on the date of registration.
2. They must possess a Permanent Account Number (PAN)
3. They must maintain an NRE or NRO bank account.
4. The PRAN issued is unique and remains with the subscriber for life, regardless of their residency status.
5. NRIs and OCIs can open a Tier I account only. The Tier II account isn't available to them.

Documents required to open an NPS account?

To successfully open an NPS account, NRIs and OCIs need to provide only a few documents as mentioned below. Having these documents ready simplifies the registration and with PensionBox, you can open your NRI/OCI NPS account in just 5 minutes.

1. PAN card
2. Passport
3. NRE or NRO account
4. A cancelled cheque
5. Scanned copies of their photograph and signature

How does NPS investment work?

NPS for NRI/OCI functions similarly to that for resident Indians. Subscribers can choose between the Auto choice, where the equity share decreases with age, the Active choice, where they can decide the allocation across asset classes, or invest in the New Multiple Scheme Framework with up to 100% equity investments. Contributions are made in rupees and invested in Indian markets.

This investment provides NRIs a rupee-denominated retirement option, which can be beneficial for those planning to return to India.

Tax implications for investing in NPS?

Investments in NPS are eligible for an additional tax deduction of up to ₹50,000 under section 124 of the Income-tax Act, 2025 (earlier section 80CCD(1B)). This deduction is available only under the old tax regime. However, NRI/OCIs should be aware that tax treatment may vary in their country of residence. It's advisable to consult a tax adviser to understand any implications fully.

Upon exit, you can take up to 80% of your corpus as a lump sum. Of the total corpus, 60% is tax-free under Schedule II of the Income-tax Act, 2025 (earlier section 10(12A)), and any lump sum above that is taxed as income. The amount used to buy an annuity is not taxed at exit, but the pension received later is taxed as income.

How can you open an NPS account as an NRI or OCI?

Opening an NPS account with PensionBox takes about five minutes if your documents are ready. The whole process is 100% online.

1. Sign up directly via your Kite ID or enter your mobile number and verify the OTP sent to it.
2. Confirm your residency. Select NRI or OCI and declare your residential status.
3. Complete KYC. Enter your PAN and upload your passport.
4. Add your bank details. Enter your NRE or NRO account details, then upload a cancelled cheque.
5. Choose how your money is invested. Pick your pension fund manager and then Auto choice, Active choice, or a scheme under the Multiple Scheme Framework.
6. Add a nominee and make your first contribution. Your PRAN is issued once the contribution is successful, usually within a minute.

Open your NPS account today →

Already have a Zerodha Kite ID?

If you have a Kite ID, you can use the same Kite ID to sign in to PensionBox and open your NRI NPS account. No new sign-up needed.

Wherever you are in the world, your retirement can stay connected to India. Open your NPS account with PensionBox.

Frequently asked questions

Can NRIs open an NPS account?

Yes, NRIs and OCIs can open an NPS account if they are aged between 18 and 85, have a PAN, and hold an NRE or NRO bank account.

What documents are needed to open an NPS account for NRIs?

You will need a PAN, passport, NRE or NRO account details, a cancelled cheque, and scans of your photograph and signature.

Can NRIs contribute to NPS from a foreign bank account?

Yes, through normal banking channels. PFRDA allows NRIs and OCIs to contribute by inward remittance or from an NRE, FCNR or NRO account in their own name. On PensionBox, you add an NRE or NRO account for your contributions.

What are the tax implications for NRIs investing in NPS?

NPS contributions are eligible for an additional deduction of up to ₹50,000 under section 124(3) of the Income-tax Act, 2025 (earlier section 80CCD(1B)), available only under the old tax regime. NRIs should also check the tax treatment in their country of residence.

What happens to an NPS account when an NRI turns 60?

Standard NPS exit rules apply. A portion can be taken as a lump sum and the rest is used to purchase an annuity.