NPS Exit After 15 Years: 80% Lump Sum Rules (2026)

Quick answer: Yes. A non-government NPS subscriber can take a normal exit after 15 years in NPS or at age 60. Whichever comes first applies. You can withdraw up to 80% as a lump sum. At least 20% must buy an annuity. Only 60% of the corpus is clearly tax-free. The extra 20% may be taxed at your slab rate.

Key Facts

PFRDA’s December 2025 exit changes allow normal exit after 15 years or at age 60. The earlier date applies.
For a corpus above ₹12 lakh, you can take up to 80% as a lump sum. At least 20% goes into an annuity.
Exit before both limits allows up to 20% as a lump sum. At least 80% must go into an annuity.
MSF schemes, live since 1 October 2025, have a 15-year vesting period. The 80/20 exit rule applies to them too.
You can delay your exit and stay invested until age 85.

Last verified: 6 October 2026, against PFRDA and PIB sources.

Many NPS subscribers ask one question. Can I take my money out after 15 years, even if I am not yet 60?

Before December 2025, normal exit started only at age 60. It allowed just a 60% lump sum. Then the Pension Fund Regulatory and Development Authority (PFRDA), the NPS regulator, changed the rules.

This guide explains the new exit rules and how much you can withdraw. It also shows how the Multiple Scheme Framework (MSF) fits in.

NPS exit rules at a glance: normal exit vs premature exit

Point	Normal exit	Premature exit
When it applies	After 15 years in NPS, or at age 60, whichever is earlier	Before both limits
Lump sum	Up to 80% (corpus above ₹12 lakh)	Up to 20%
Annuity	At least 20%	At least 80%
Small corpus	Up to ₹8 lakh: take 100%	Up to ₹5 lakh: take 100%
Lock-in	Not applicable	No minimum lock-in (removed in December 2025)

This table covers non-government subscribers on the All Citizen Model. Corporate NPS subscribers still follow retirement or superannuation age, as per PIB.

Deepak Gokul holds the CWM® certification, is NISM-Series-XVII: Retirement Adviser Certified, and is an IRDAI Licensed Insurance Advisor. His firm, Deepak Wealth Framework Pvt Ltd, is based in Pallikaranai, Chennai, and helps families across India plan retirement. Every rule below comes from PFRDA, PIB or the NPS Trust.

What are the NPS exit rules after 15 years?

Since December 2025, a non-government subscriber qualifies for normal exit after 15 years in NPS, or at age 60. Whichever comes first applies. So someone who joined at 35 can exit at 50.

Normal exit is the better route. You keep up to 80% as a lump sum. Premature exit pushes 80% into an annuity. An annuity is a plan where an insurer pays you a fixed pension.

How much can you withdraw at normal exit?

The limit depends on your corpus. Corpus means your total NPS savings on the exit day.

Corpus at exit	Lump sum	The rest
Up to ₹8 lakh	Up to 100%	Nothing is compulsory
₹8 lakh to ₹12 lakh	Up to ₹6 lakh	Systematic Unit Redemption (SUR) for at least 6 years, or an annuity
Above ₹12 lakh	Up to 80%	At least 20% annuity

Example: Your corpus is ₹1.5 crore at exit. One crore equals 100 lakh. You can take up to ₹1.2 crore as a lump sum. At least ₹30 lakh goes into an annuity.

Suppose the annuity pays 6% a year. That gives ₹1.8 lakh a year, or ₹15,000 a month. The 6% is only an example. Annuity rates differ by provider and option.

What is the MSF 15-year vesting rule?

The Multiple Scheme Framework (MSF) started on 1 October 2025. It lets non-government subscribers hold several schemes under one PRAN. PRAN is your Permanent Retirement Account Number.

On 28 August 2026, PFRDA issued new circulars on scheme classification. They end the old split between “common” schemes and MSF schemes. MSF schemes now carry a risk category from A to E. Category A holds 80% to 100% equity.

MSF schemes also carry a minimum vesting period of 15 years. Vesting means the waiting period before you get full freedom with the scheme. The August 2026 circular sets these switching rules:

You can make at most two change requests a year. A request can change your pension fund or your scheme.
A scheme change keeps your original vesting date.
A merger of your money into another scheme adopts the new scheme’s terms, including its vesting period.
If PFRDA winds up your scheme and you do not choose, your money moves to Life Cycle 50 – Moderate.

The exit split does not change with MSF. PIB says the December 2025 changes apply uniformly to common schemes and MSF. So 80/20 applies to MSF too.

Does the 15 years count your old NPS money?

Normal exit needs 15 years of NPS subscription. That means time in NPS, not time in one scheme. The MSF vesting rule is a separate matter.

One CRA-run explainer says MSF vesting applies to fresh contributions into MSF schemes. It says existing corpus stays unaffected. Other explainers call this unclear.

Please verify this information from the latest official source. Ask your CRA how your own vesting dates stand before you switch or merge.

Is the NPS lump sum tax-free?

Only 60% of your corpus is clearly tax-free. This exemption was earlier Section 10(12A) of the Income-tax Act, 1961. The Income-tax Act, 2025, which applies from 1 April 2026, renumbers sections.

PFRDA now allows 80%. But reports up to May 2026 say tax law has not changed for the extra 20%. That part is taxable at your slab rate. The pension you get from the annuity is also taxed as income.

Systematic Lump Sum Withdrawal (SLW) lets you take the lump sum in parts. It may help spread the taxable portion across years. Ask a tax adviser before you choose.

What are your options at the 15-year mark?

Market experts describe these routes. Confirm each one with your CRA before you apply.

Take up to 80% now and buy the annuity with the rest.
Take 80% now and delay the annuity, up to age 85.
Buy the annuity now and delay the lump sum, up to age 85.
Delay both and stay invested until age 85.
Take the lump sum in instalments through SLW, up to age 85.
Use a Retirement Income Scheme (RIS) or drawdown option for regular payouts up to age 85.

PFRDA launched RIS on 15 May 2026. Its payouts are market-linked and not guaranteed. You must still meet the minimum annuity rule.

What if you exit before 15 years or before 60?

Premature exit pays up to 20% as a lump sum. At least 80% must buy an annuity. If your corpus is ₹5 lakh or less, you can take all of it.

You can also take partial withdrawals without exiting. You can make up to four before age 60. Each one is capped at 25% of your own contributions.

You need four years between withdrawals. Allowed reasons include children’s higher education or marriage, a one-time home purchase or build, medical treatment, and disability needs. Check the minimum subscription period on your CRA portal.

Regulated lenders can also place a lien on up to 25% of your own contribution. That lets you borrow against NPS without exiting.

Can you cancel or surrender the annuity?

Mostly no. In October 2024, PFRDA made annuities very hard to exit. In May 2026, it allowed surrender in two cases.

The first is critical illness of you or a family member. The second is an older policy, bought before 24 October 2024, that already had a surrender clause. So choose your annuity with care.

How do you apply for NPS exit?

Check your PRAN start date. Count 15 years from it.
Log in to your Central Recordkeeping Agency (CRA) account. The CRA keeps your NPS records.
Open the exit or withdrawal option.
Upload your ID, age proof and bank proof.
Choose your lump sum, annuity and any delay.
Pick an Annuity Service Provider (ASP). This is the insurer that pays your pension.
Verify with an OTP and eSign.

Screens and forms change often. Follow what your CRA portal shows.

Frequently asked questions

Can I withdraw NPS after 15 years if I am below 60?

Yes, if you are a non-government All Citizen subscriber. Since December 2025, normal exit opens after 15 years in NPS or at age 60, whichever comes first. You do not need to be 60. Corporate NPS subscribers still follow retirement or superannuation age, as per PIB.

How much NPS money can I withdraw after 15 years?

If your corpus is above ₹12 lakh, you can take up to 80% as a lump sum. At least 20% must buy an annuity. For ₹8 to ₹12 lakh, the lump sum is up to ₹6 lakh. Up to ₹8 lakh, you can take everything. Only 60% of the corpus is clearly tax-free.

Does the 80/20 exit rule apply to MSF schemes?

Yes. The PIB summary says the December 2025 changes apply uniformly to common schemes and the Multiple Scheme Framework. So the 80% lump sum and 20% annuity rule covers MSF schemes too. MSF is open only to non-government subscribers, so this applies to them.

What is the 15-year vesting period in NPS MSF?

MSF schemes carry a minimum vesting period of 15 years. Under the PFRDA circular of 28 August 2026, a scheme change keeps your original vesting date. A merger adopts the terms of the new scheme. You can make two change requests a year. Ask your CRA how this applies to your money.

Is the 80% NPS lump sum tax-free?

Not fully. The tax exemption, earlier Section 10(12A), covers only 60% of the corpus. Reports up to May 2026 say the extra 20% is taxable at your slab rate. Annuity income is taxable too. Please verify this information from the latest official source.

What happens if I exit NPS before 15 years?

You can take up to 20% as a lump sum. At least 80% must buy an annuity. If your corpus is ₹5 lakh or less, you can withdraw all of it. PFRDA removed the earlier lock-in for premature exit in December 2025. Partial withdrawals are another option, up to four times before age 60.

Do government employees get the same NPS exit rules?

No. Government employees still follow the 60:40 rule. They can take up to 60% as a lump sum and must use at least 40% for an annuity. The same ₹8 lakh and ₹12 lakh corpus limits apply to them. MSF is open only to non-government subscribers.

Planning your NPS exit?

Talk to Deepak Wealth Framework in Pallikaranai, Chennai. We help you plan the lump sum, annuity and tax before you apply.

Book a consultation

Call +91 91763 40301 or +91 99402 47435

Deepak Gokul, CWM®

Chartered Wealth Manager (CWM®) · NISM-Series-XVII: Retirement Adviser Certified · IRDAI Licensed Insurance Advisor · Founder, Deepak Wealth Framework

Deepak Wealth Framework Pvt Ltd — AMFI Registered Mutual Fund Distributor | ARN-328771

Deepak Gokul specialises in goal-based financial planning, child education planning, SIP investments, mutual fund advisory, and retirement planning for families across the globe. With his Chartered Wealth Manager (CWM®) certification and specialised training in retirement advisory, Deepak helps clients build long-term wealth through structured, disciplined financial planning.

📍 Pallikaranai, Chennai

NPS returns are market-linked and not guaranteed. PFRDA and tax rules can change, so verify with official sources before you act. Mutual Fund investments are subject to market risks, read all scheme related documents carefully. This content is for illustrative and educational purposes only. We deal in Regular Plans.

NPS EXIT RULES AFTER 15 YEARS