Union Budget 2024 has raised the deduction on employers' National Pension System (NPS) contribution to employees' basic salary from 10 percent to 14 percent.
This will apply to public sector companies, private sector under the new regime. Government employees already enjoy a deduction of 14 percent. This deduction under section 80CCD(2) is available under both the regimes, but the higher rate of 14 percent will be applicable only under the new, simplified regime.
Similar benefits will flow in to employers as well. "To improve social security benefits, deduction of expenditure by employers towards NPS is proposed to be increased from 10 to 14 per cent of the employee’s salary," Finance Minister Nirmala Sitharaman said in her Budget speech.
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