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  5. Unified Pension Scheme switch deadline 2025: Only one day left until September 30. 4 key myths vs facts about UPS

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Unified Pension Scheme switch deadline 2025: Only one day left until September 30. 4 key myths vs facts about UPS

Upstox
By Upstox News Desk

2 min read | Updated on September 29, 2025, 07:39 IST

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SUMMARY

With the September 30 deadline to switch to the Unified Pension Scheme fast approaching, it's important to address some common misconceptions. Here’s a look at 4 key myths vs facts about UPS.

myth vs facts about ups

UPS is also market-linked and provides similar investment options. | Image: Shutterstock

The deadline to switch to the Unified Pension Scheme (UPS) is almost here. September 30 is the last date for central government employees currently under the National Pension System (NPS) to make the switch.
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While the NPS offers flexibility in fund choices, investment patterns, partial withdrawals, and annuity options, UPS guarantees a fixed monthly pension, 50% of the average basic pay from the last 12 months, indexed to inflation.

As the deadline approaches, it’s important to clear up some common misconceptions. Here's a look at 4 myths vs facts about UPS:

Myth vs Fact: Understanding the Unified Pension Scheme (UPS)

Myth 1: NPS is more financially rewarding because government contributions are higher.
Fact: Under UPS, the Central Government contributes an additional 8.5% to a pooled corpus, in addition to the 10% employee and 10% employer contributions. This fund enables lump-sum benefits, assured pension payouts with Dearness Relief (DR), and even a 60% family pension. These features are not available under NPS.
Myth 2: UPS does not benefit those opting for Voluntary Retirement (VRS).
Fact: Employees taking VRS receive an immediate 10% lump-sum payout and can withdraw 60% of their accumulated corpus upfront. The assured monthly pension commences from the deemed date of retirement, ensuring financial stability after VRS.
Myth 3: [UPS]([https://upstox.com/news/personal-finance/tax/unified-pension-scheme-explained-5-must-know-income-tax-benefits-ahead-of-september-30-ups-switch-deadline/article-182064/] offers no support for the family after the pensioner and spouse.
Fact: At retirement, employees can withdraw 60% as a lump sum to support family needs. In case of in-service death, the OPS family pension structure is applied, ensuring continued support beyond the pensioner and spouse.
Myth 4: Only NPS is market-linked and offers better returns.
Fact: UPS is also market-linked and provides similar investment options. Moreover, subscribers can retain any surplus earnings. The key advantage: UPS guarantees a minimum pension payout with DR, protecting against inflation and longevity risks.
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About The Author

Upstox
Upstox News Desk is a team of journalists who passionately cover stock markets, economy, commodities, latest business trends, and personal finance.

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