Outlook Money
APY is a government scheme that aims to provide financial security to workers from the unorganised sector. This scheme is administered by PFRDA.
Indian citizens aged 18 to 40 can open an APY account through banks or designated post offices. Individuals enrolled in the scheme between FY2015-16 and FY2019-20 also receive contributions to their APY accounts, if they are not taxpayers or beneficiaries of any government social security scheme.
Pensions in APY pensions are provided in five slabs: Rs 1,000, Rs 2,000, Rs 3,000, Rs 4,000, or Rs 5,000 per month, depending on the contributions of the subscriber and age.
1. Guaranteed Regular Pension: APY provides fixed pensions for a lifetime. While there are other alternatives for long-term guaranteed returns, such as a provident fund, only a few of them provide pensions.
In this scheme, the spouse is the default nominee of the pension upon the subscriber's death. If the subscriber is unmarried then they can nominate anyone.
Under sections 80CCD (1B) and 80C, contributions to the scheme are eligible for tax deductions. However, the tax benefits are only available to APY members who joined before October 1, 2022. The scheme's admission requirements state that a subscriber can be anyone who is not an income taxpayer.