NPS Tax Deduction Calculator — 80CCD(1), 80CCD(1B) and 80CCD(2)
Reviewed by Finin2min Editorial Desk · Last Reviewed 12 September 2026
Calculate own and employer Tier-I NPS deductions using salary, gross-income, old/new regime and shared-ceiling rules.
2-minute answer
NPS tax deduction calculator for ₹1.5 lakh shared limit, ₹50,000 additional deduction and 10%/14% employer contribution.
Current-law note: Reviewed on 12 September 2026. Check any later amendment, notification, circular, deadline or portal instruction before taking action.
How to use this page
Use the page as a decision tool: keep inputs on the same basis, make assumptions explicit and test a downside scenario before relying on the output.
Practical checklist
Use dated statements or contracts rather than rough estimates where possible.
Keep monthly/annual and pre-tax/post-tax units consistent.
Test at least one conservative scenario.
Record the assumption that most changes the result.
Reviewed: 12 September 2026. The applicable statute, rule, notification, order or official filing instruction prevails.
Calculate employee, self-employed and employer NPS deductions
NPS deduction result
Tier-II contribution is not included. The same own contribution cannot be claimed twice.
Own-contribution deduction
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Employer-contribution deduction
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Component
Amount
Own contribution within shared ₹1.5 lakh ceiling
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Additional own contribution under 80CCD(1B)
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Employer-contribution limit applied
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Total NPS deduction displayed
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How This Is Calculated
NPS offers layered deductions: employee's own contribution up to ₹1.5 lakh under Section 80CCD(1) (within the overall 80C cap), an additional ₹50,000 under Section 80CCD(1B) exclusively for NPS, and employer contributions deductible separately under Section 80CCD(2), with the employer-contribution percentage cap differing between the old and new tax regime.
Frequently Asked Questions
What is the extra ₹50,000 NPS deduction under Section 80CCD(1B)? ▼
This is an additional deduction exclusively for NPS contributions, over and above the ₹1.5 lakh combined Section 80C/80CCD(1) limit — meaning a taxpayer can potentially deduct up to ₹2 lakh total between 80C and NPS if they use both the regular 80C room and this extra NPS-only allowance.
Is the employer NPS contribution deduction available under the new regime? ▼
Yes — unlike most deductions, the employer's NPS contribution under Section 80CCD(2) remains available under the new tax regime, though the percentage-of-salary cap differs between the old and new regime.
Can I claim both 80CCD(1) and 80CCD(1B) for my own NPS contribution? ▼
Yes, together they allow up to ₹2 lakh of your own contribution to be deducted: ₹1.5 lakh within the general 80C/80CCD(1) cap, plus a further ₹50,000 exclusively under 80CCD(1B) that doesn't compete with your other 80C investments.
Source and review trail
Use the current official instrument, portal or regulator publication before acting. This panel separates the category authority from page-specific references.
For AY 2026-27, own-contribution deductions under sections 80CCD(1) and 80CCD(1B) remain old-regime deductions. Employer contribution under section 80CCD(2) remains available in the new regime; the 14% cap applies to all employer categories in the new regime, while the old-regime cap for a non-government employer remains 10%. Use salary as defined for section 80CCD, not CTC.
Do not treat NPS as an EPFO product. Validate tax deduction with the Income Tax Department and scheme/operational rules with PFRDA. Keep Tier-I contribution evidence and PRAN; do not double-count the same own contribution under 80CCD(1) and 80CCD(1B).
Input integrity
Use source documents rather than approximate memory.
Confirm period, units, tax regime/category and sign conventions.
Test zero, threshold and just-above-threshold cases where relevant.
Output interpretation
Separate arithmetic output from legal eligibility/classification.
Preserve assumptions and the official-source date.
Use the linked detailed guide for exceptions and evidence.
Reviewed 12 September 2026. Always test later amendments, corrigenda and portal implementation before a live filing or transaction.
Methodology, assumptions and sources
Scope: Computes the tax deduction available for NPS contributions across Section 80CCD(1) (employee's own contribution, within the overall 80C limit), Section 80CCD(1B) (additional exclusive deduction) and Section 80CCD(2) (employer's contribution), applicable only under the old regime for 80CCD(1)/(1B), with 80CCD(2) available under both regimes.
Calculation logic
Section 80CCD(1): employee's own NPS contribution deductible up to 10% of salary (basic + DA) for salaried employees, or 20% of gross total income for self-employed individuals, but this deduction is clubbed within the overall Section 80C/80CCC/80CCD(1) combined ceiling — not a separate limit on top of 80C.
Section 80CCD(1B): an additional, exclusive deduction of up to ₹50,000 for NPS contribution, over and above the Section 80C/80CCD(1) combined ceiling — available only under the old regime.
Section 80CCD(2): employer's NPS contribution deductible up to a percentage of salary (currently 14% of salary for both central government employees and, per the extended rule, private-sector employees under the new tax regime, or 10% under the old regime for private-sector employees) — this is available under both tax regimes, unlike 80CCD(1)/(1B).
Inputs and assumptions
80CCD(1) and 80CCD(1B) deductions are available only under the old tax regime; 80CCD(2) (employer's contribution) remains available under both regimes, with the percentage cap differing by regime as currently prescribed — the calculator applies the correct cap for the regime and employer-type (government/private) selected.
The 80CCD(1) clubbing within the overall 80C ceiling means a taxpayer who has already exhausted the 80C limit through other investments gets no incremental benefit from 80CCD(1) specifically, though 80CCD(1B) remains available as a genuinely separate ₹50,000 deduction.
Exclusions and edge cases
Does not itself compute the underlying tax liability from scratch — use the main Income Tax Calculator for the full computation, applying the NPS deduction figures computed here as inputs.
Self-employed individuals use a different percentage base (20% of gross total income) for 80CCD(1) than salaried employees (10% of salary) — the calculator applies the correct base per the employment-type selected.