Individuals who file their Income Tax Returns or pay tax will not be allowed to open APY accounts from October 1, 2022.
“Provided that from 1st October 2022, any citizen who is or has been an income-tax payer, shall not be eligible to join APY,” the Department of Financial Services under the Ministry of Finance said in a notification dated 10 August 2022.
What happens if you open APY account on or after October 1
As per the notification, if a subscriber joins APY on or after 1 October 2022 and is subsequently found to have been an income tax payer on or before this date then his/her account will be closed. The accumulated pension wealth of such subscribers would be returned.
“In case a subscriber, who joined on or after 1st October 2022, is subsequently found to have been an income-tax payer on or before the date of application, the APY account shall be closed and the accumulated pension wealth till date would be given to the subscriber,” the notification said.
What should taxpayers do?
Taxpayers, who want to have an APY account, can join the scheme before October 1, 2022. So you can become an APY subscriber till 30 September 2022. Beyond this date, your APY account will become invalid.
Should taxpayers have an APY account?
The APY account is primarily meant for low-income groups who do not have access to other pension schemes that can offer guaranteed pensions after retirement. The monthly minimum guaranteed pension is up to Rs 5000 only under APY. Taxpayers can join a scheme like the National Pension System (NPS) which can provide higher pension amounts post-retirement. Taxpayers can also subscribe to schemes like Public Provident Fund (PPF) for higher guaranteed and tax-free returns.
Who can join APY?
Currently, Indian citizens aged 18-40 are eligible to join Atal Pension Yojana. You can subscribe to the scheme through the bank or post office branches where you have your savings bank account. According to official data, the total number of APY subscribers at the end of March 2022 was 4.01 crore.
