How to make an application for Permanent retirement account number

When the Direct Taxes Code is implemented from 1 April 2012, the options to invest in tax-saving instruments that provide equity exposure are likely to reduce. The only tool that combines long-term equity investment with tax saving could be the New Pension Scheme (NPS). The contributions made by the investor are put in a combination of equity and debt by the NPS. If the investor opts for the auto investment choice facility, the equity exposure keeps reducing as the age of the investor increases. Otherwise, it is capped at 50%. Any Indian, including an NRI between 8 and 55 years, can invest in the NPS. To do this, they must first make an application for permanent retirement account number ( PRAN).

Points to note

Single account: An investor can have only one NPS account. Multiple accounts and PRANs are not allowed.

NRI investors: Such investors need to provide an Indian address for communication and bank account details. Contributions made by NRIs will be subject to RBI regulations.

Holding pattern: While the NPS account can be held by a single person, the investor can make up to three nominations.


The content on this page is courtesy Centre for Investment Education and Learning (CIEL)