Here are tips you need to know:

  • Once you receive the provident fund benefit, you need to open the pension savings account with any banks or post offices of your choice.
  • Inform your pension saving account number to NPPF after account opening and then you will receive life-long pension by direct fund transfer every month.

  • Must plan to retire decently to receive the benefits timely
  • Three things that a member must know:
    • Gratuity and other fringe benefits from your employer
    • Group-Saving Insurance (GIS) from RICBL
    • Pension and/or Provident Fund

For each type of benefits, the requirements are different and one must know the formalities to be completed in advance

Eligibility Criteria
A member becomes eligible for pension after twenty years of membership in the scheme, provided the member attains normal retirement age as per their respective service rules. A member may however avail monthly pension five years prior to attaining the normal retirement age. The monthly pension is reduced accordingly for the number of months falling short of normal retirement age.

Surviving Family Benefits
A member must have served for a minimum of three years to be eligible for surviving family benefits. Up to three children at a time of the deceased members, under the age of 18 years receive monthly pension are eligible for the benefit. The benefit amount is slightly higher for orphans.
Surviving spouse of a member is also eligible for monthly pension, in addition to the children/orphan benefit. Spouse of deceased armed forces personnel start receiving monthly pension immediately upon demise of member. Spouse of civil service members start receiving monthly pension only from the age of 50 years.
For deceased members having left only their surviving parents, the parents are eligible for monthly pension.

Pension formula and annual indexation
Monthly pension: Depends on the basic salary upon retirement and the number of years of service. Once started, pension is paid until the death of member and is indexed annually based on CPI, up to a maximum of 5%. Thereon, surviving family members are eligible to receive other pension benefit.

If you are nearing retirement and need to plan for it, here are some tips for you:

  1. Once you receive the provident fund benefit, you need to open the pension savings account with any banks or post offices of your choice.
  2. Inform your pension saving account number to NPPF after account opening and then you will receive life-long pension by direct fund transfer every month.

Dos

  1. Obtain “Pension account opening letter” from NPPF.
  2. Obtain Pension saving card and ATM card against pension saving account from one of the banks of your choice by submitting above letter to the Bank.
  3. May avail online/moblile banking facilities such as mbob, epay, mpay, etc as per banking norms.
  4. Forward the duly filled “confirmation of pension account letter” to NPPF.
  5. Withdraw pension at the end of the month only as it will be credited by end of each month.
  6. Produce pension card and pension saving card when visiting banks/Bhutan post for withdrawal other than from ATMs.
  7. Furnish “non-remarriage certificate form” duly endorsed and signed by banks banks/Bhutan Post office/Gup/Tshogpa/NPPF office concerned once every year on or before 30th April for continuous payment to the spouse and children’s beneficiaries.
  8. Refer matters related to nomination or authorization to NPPF for approval.
  9. Authorized person shall submit duly filled non-remarriage certificate forms” on behalf of the pensioners.
  10. Provide or update your mobile no. with NPPF offices to receive pension related information such as increments, submission of forms, pension TDS for filing PIT via SMS.

Don'ts

  1. Don’t let others including your family members/relatives withdraw your pension if they are not authorized by NPPF to do so because NPPF/Banks/Bhutan Post Offices shall not be liable for such delinquency.
  2. Don’t share your ATM pin with others if you avail ATM facilities.

Dos

  1. Open Pension saving account upon production of “pension account opening letter” from NPPF by individual pensioners or beneficiaries.
  2. Forward the duly filled “confirmation of pension savings account by banks/Bhutan Post offices” to NPPF.
  3. Issue ATM against Pension Saving Account and provide net banking or online banking facilities (such as mbob, epay, mpay, etc) as per banking norms.
  4. Endorse the duly filled “revised Non-Remarriage Certificate Form” submitted and declared unmarried personally by spousal pension beneficiaries.
  5. Refer all matters related to nomination or authorization of pension withdrawal to NPPF offices for approval.
  6. Report absconded or convicted of a felony under court of law or the relinquished citizenship identity card cases of pensioners/beneficiaries, if any to NPPF.
  7. Provide list of Pensioners availing ATM services to NPPF on a quarterly basis.

Don'ts

  1. Prohibit deposit facilities to pension account by any person other than the direct crediting by banks authorized by NPPF in form of monthly pension.
  2. Prohibit Standing Instruction and Cheque facilities.
  3. Don’t allow withdrawal without production of pension card.
  4. Don’t allow withdrawal of pension by third party unless authorized by the NPPF.
  5. Don’t accept authorization letter from pensioners/spouses/children for withdrawal of monthly pension without NPPF’s approval.

Benefits

There are two two types of benefits provided by NPPF: Pension and Provident Fund.
Provident fund is paid in lump-sum i.e. accumulated contribution and rate of return. The rate of return is declared and credited to each individual account based on the investment performance. The rate of return is credited to contribution as well as accumulated interest.

Pension is a stream of income paid regularly to the members qualified for monthly pension with a minimum of 10 years of contribution and retired attaining the superannuation age. The benefit is defined by the formula that specifies the amount of benefit as percentage of basic salary.

Armed Forces

  • Monthly pension = (45% x Final Basic Salary x No.of years of service)/27
  • Where, Final Basic Salary is the average of the last 12 months.

For Civil Employees

  • Monthly pension = [40% x Final Basic Salary x No. of years of service(Maximum 30 years)]/30

Note:

Contributions after 30 years in pension is given as lumpsum

Early pension prior to five years of superannuation age is paid with reduced pension amount of 6% per annum.
Members who are not qualified for monthly pension are paid lump-sum benefit i.e. all the contributions and the rate or return.

Benefit Disbursement

You need to know the benefit you will receive. You will receive provident fund (Tier 2) in lump-sum i.e. all cYou need to know the benefit you will receive. You will receive provident fund (Tier 2) in lump-sum i.e. all contributions you have made during your service and interests earned. If you do not qualify to receive monthly pension, you will also receive lump-sum benefit from pension account (Tier 1) along with interest.  You may choose to receive the benefit either in cheque or via fund transfer to your personal savings account.

If you are qualified for monthly pension, then you will receive your monthly pension benefit by direct transfer to your pension savings account.

Your monthly pension is subject to personal income tax like the tax you have paid while in service. The monthly pension will be deposited into your account, less all taxes and any deduction. If you are a member of Royal Society for Senior Citizens and Lotdeh Scheme, you will receive your monthly pension after deduction of your membership fee or contribution to Lotdeh.

You will receive your Pension Tax Deducted at Source certificate from NPPF or download from our website (Annual notification will be issued)

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