8 big changes in Unified Pension Scheme to know before the UPS switch deadline

The central government had notified the UPS option on January 24, 2025. Since June 2025, several changes have been announced to make UPS more attractive to employees.

As the deadline to opt for UPS is near, here's a look back at eight big changes in the scheme since June:

1)The Government has allowed a one-time, one-way switch facility for UPS subscribers to opt back to the NPS: With this option, employees will get one chance to switch back to NPS if they switch to UPS now but do not feel happy about it later during their service period.

2)The Government has announced the option for benefits under the CCS (Pension) Rules or PFRDA (Operationalization of UPS under NPS) Regulations, 2025 in the event of death or disability or invalidation of the employee during service

3)Under UPS, employees have been provided the benefits of retirement gratuity and death gratuity.

4)The income tax benefits for UPS subscribers have been notified under the Income Tax Act, 2025. These benefits also include tax exemption on the lump sum received at retirement.

5)The government has granted benefits under UPS in cases where departmental or judicial proceedings are pending on the date of retirement.

6)The government has allowed pro-rata assured payouts under UPS in case of voluntary retirement after 20 years of qualifying service.

7)UPS benefits are payable on absorption in an autonomous body/PSU.

8)The original deadline to opt for UPS was extended. Now, there is a one-time option to migrate to UPS till September 30 for central government employees, including those joined on or after April 1, 2025 and up to August 31, 2025.