NPS Partial Withdrawal: Rules, Process & Documents Required

NPS Tier 1 is primarily a retirement savings account with restricted withdrawals. However, PFRDA allows partial withdrawal from your NPS Tier 1 corpus for specific life events. This guide explains the eligibility criteria, limits, documents needed, and the step-by-step online process.

What is NPS Partial Withdrawal?

NPS partial withdrawal allows you to withdraw up to 25% of your own contributions (not employer contributions or investment gains) from your Tier 1 account before retirement. This facility is available only for specified reasons and has strict conditions.

Key points:

• Maximum 25% of your own contributions can be withdrawn
• Only for specific reasons approved by PFRDA
• Account must be at least 3 years old
• Maximum 3 partial withdrawals allowed during the entire NPS tenure
• Withdrawals are tax-free

Eligible Reasons for Partial Withdrawal

PFRDA permits partial withdrawal only for these reasons:

1. Higher education of children — for graduation, post-graduation, or professional courses of children (including legally adopted children)
2. Marriage of children — for the marriage of children (including legally adopted children)
3. Purchase or construction of residential house/flat — first house purchase only (not applicable if you already own a house, excluding ancestral property)
4. Treatment of critical illness — for treatment of specified illnesses of self, spouse, children, or dependent parents. Covered illnesses include cancer, kidney failure, heart valve surgery, stroke, major organ transplant, etc.
5. Disability or incapacitation — if the subscriber suffers more than 75% disability as per government norms

Withdrawal Limits

Example: If you have contributed ₹10,00,000 to NPS over 5 years, the maximum partial withdrawal is ₹2,50,000 (25% of ₹10,00,000). Note: employer contributions and investment returns are not counted.

Documents Required

For All Withdrawal Reasons:

• PRAN card or PRAN number
• Bank account details (linked to NPS)
• Aadhaar card
• Cancelled cheque of linked bank account

Reason-Specific Documents:

For Children's Education:

• Admission letter or fee receipt from the educational institution
• Proof of relationship (birth certificate of child)

For Children's Marriage:

• Wedding invitation card or marriage registration application
• Proof of relationship (birth certificate of child)

For House Purchase/Construction:

• Sale agreement or allotment letter
• Self-declaration that you do not own any other residential property (except ancestral)
• Builder/seller details and payment schedule

For Medical Treatment:

• Medical certificate from a registered medical practitioner
• Hospital admission or treatment documents
• Bills or cost estimates from the hospital

For Disability:

• Disability certificate from competent medical authority (75% or more)

Step-by-Step Online Process

Method 1: Through CRA Website (NSDL)

1. Log in to CRA portal — Visit cra-nsdl.com and log in using your PRAN and password
2. Navigate to withdrawal — Go to "Transact Online" → "Partial Withdrawal"
3. Verify eligibility — The system will check if your account meets the 3-year requirement and withdrawal limit
4. Select reason — Choose the reason for partial withdrawal from the dropdown
5. Enter amount — Enter the withdrawal amount (up to 25% of your contributions). The system shows the maximum eligible amount
6. Upload documents — Upload the required supporting documents as per the reason selected
7. Verify bank details — Confirm the bank account where you want to receive the funds
8. Authenticate — Verify with OTP sent to your registered mobile number
9. Submit request — Review all details and submit. Note down the acknowledgement number
10. Track status — Check the status under "Transaction Statement" on the CRA portal

Method 2: Through Nodal Office (Government/Corporate Subscribers)

If you are a government or corporate NPS subscriber:

1. Submit the partial withdrawal form to your employer's nodal officer
2. Attach all required documents
3. The nodal officer verifies and forwards to CRA
4. Processing takes 2-3 weeks after nodal officer approval

Processing Time

• Online (All Citizens Model): 7-10 working days after document verification
• Through Nodal Officer: 15-20 working days (includes employer processing time)
• Amount credited to: Bank account linked to your PRAN

Important Tips

1. Plan withdrawals carefully — you get only 3 partial withdrawals in your entire NPS tenure
2. For Tier 2 withdrawals — there are no restrictions on Tier 2 account withdrawals; you can withdraw anytime without any reason
3. Keep documents ready — incomplete documentation is the most common reason for rejection
4. Check contribution details first — log in to CRA and check your "Contribution Statement" to know the exact 25% limit
5. Medical emergencies — the 5-year gap rule does not apply for medical treatment withdrawals

Frequently Asked Questions

Is NPS partial withdrawal taxable?

No. Partial withdrawal from NPS Tier 1 is completely tax-free under Section 10(12A) of the Income Tax Act, regardless of the reason.

Can I withdraw from NPS before 3 years?

No. The minimum account age for partial withdrawal is 3 years. Before 3 years, you can only exit NPS completely (premature exit), which has different rules and tax implications.

What if my partial withdrawal request is rejected?

Common reasons for rejection include incomplete documents, ineligible reason, or exceeding the 25% limit. You can resubmit with correct documents. Contact the CRA helpline at 1800-222-080 for assistance.

Can I withdraw for my own education or marriage?

No. Partial withdrawal for education and marriage is allowed only for children (including legally adopted children), not for self.

Does employer contribution count in the 25% calculation?

No. The 25% limit applies only to your own contributions. Employer contributions and investment returns are excluded from the calculation.

Can I make a partial withdrawal after age 60?

No. After age 60, you must follow the NPS exit/maturity process, not the partial withdrawal route.

What is the minimum amount I can withdraw?

PFRDA has not specified a minimum amount for partial withdrawal. However, the maximum is 25% of your own contributions.

This guide is for informational purposes only and is not affiliated with PFRDA, NSDL, or any government body. Rules may change — always verify on the official CRA portal or PFRDA website.