## 7th Pay Commission New Commutation Factor Table Calculation

**Commutation is one of the retirement benefits for Government employees to sell a particular percentage of basic pension on an optional basis.**

Central government employees have the option to receive a lump sum amount instead of monthly payments for up to 40% of their basic pension. To calculate this amount, a Commutation Table is used, which factors in the employee’s age at their next birthday. According to the CCS (Commutation of Pension) Rules of 1981, the applicable factor is based on the employee’s age at the time of retirement. The formula for calculating the value of the pension can be derived accordingly.

- 40 percentage of Basic Pension x Commutation Factor x 12
- Effective from 1.3.1971: Commuted Value = 0.4 (Maximum) x Pension x Commutation Factor x 12

**Table of Contents**

Commutation Calculator for Government Employees – Click to Calculate

### Commutation Factor Table for Central Government Employees

The Central Government provides two types of commutation tables for its employees. The first table is intended for those who retired prior to March 1971, while the second table is meant for those who retired after 2006.

Table 1: Commutation values of a pension of Rs. 1 per annum, effective from 1.3.1971

### Commutation of Defence Pensioners

Pensioners who served in the Defence sector may choose to exchange a portion of their pension for a one-time payment of up to 50%. Commutations made on or after September 2nd, 2008 will adhere to the updated table of commutation value for pensions. Pay Matrix Table 2023 for Central Government Employees

### Commutation Tables Value for Central Government Employees

Age next Birthday | Commutation value |

20 | 9.188 |

21 | 9.187 |

22 | 9.186 |

23 | 9.185 |

24 | 9.184 |

25 | 9.183 |

26 | 9.182 |

27 | 9.180 |

28 | 9.178 |

29 | 9.176 |

30 | 9.173 |

31 | 9.169 |

32 | 9.164 |

33 | 9.159 |

34 | 9.152 |

35 | 9.145 |

36 | 9.136 |

37 | 9.126 |

38 | 9.116 |

39 | 9.103 |

40 | 9.090 |

41 | 9.075 |

42 | 9.059 |

43 | 9.040 |

44 | 9.019 |

45 | 8.996 |

46 | 8.971 |

47 | 8.943 |

48 | 8.913 |

49 | 8.881 |

50 | 8.846 |

51 | 8.808 |

52 | 8.768 |

53 | 8.724 |

54 | 8.678 |

55 | 8.627 |

56 | 8.572 |

57 | 8.512 |

58 | 8.446 |

59 | 8.371 |

60 | 8.287 |

61 | 8.194 |

62 | 8.093 |

63 | 7.982 |

64 | 7.862 |

65 | 7.731 |

66 | 7.591 |

67 | 7.431 |

68 | 7.262 |

69 | 7.083 |

70 | 6.897 |

71 | 6.703 |

72 | 6.502 |

73 | 6.296 |

74 | 6.085 |

75 | 5.872 |

76 | 5.657 |

77 | 5.443 |

78 | 5.229 |

79 | 5.018 |

80 | 4.812 |

81 | 4.611 |

### Rate of Interest for Commutation

The below mentioned tables provide information on the commutation values for a pension of Rs. 1 per annum as per 6th CPC recommendations, effective from 1.1.2006, and also for effective from 1.3.1971. The commutation values in the table is calculated based on the rate of interest on Commutation of Pension which is 8.00% per annum and 4.75% per annum respectively.

#### Table for Commutation Values for a Pension of Rs.1 Per Annum

Age next Birthday | Commutation value | Age next Birthday | Commutation value | Age next Birthday | Commutation value |

20 | 9.188 | 41 | 9.075 | 62 | 8.093 |

21 | 9.187 | 42 | 9.059 | 63 | 7.982 |

22 | 9.186 | 43 | 9.040 | 64 | 7.862 |

23 | 9.185 | 44 | 9.019 | 65 | 7.731 |

24 | 9.184 | 45 | 8.996 | 66 | 7.591 |

25 | 9.183 | 46 | 8.971 | 66 | 7.431 |

26 | 9.182 | 47 | 8.943 | 68 | 7.262 |

27 | 9.180 | 48 | 8.913 | 69 | 7.083 |

28 | 9.178 | 49 | 8.881 | 70 | 6.897 |

29 | 9.176 | 50 | 8.846 | 71 | 6.703 |

30 | 9.173 | 51 | 8.808 | 72 | 6.502 |

31 | 9.169 | 52 | 8.768 | 73 | 6.296 |

32 | 9.164 | 53 | 8.724 | 74 | 6.085 |

33 | 9.159 | 54 | 8.678 | 75 | 5.872 |

34 | 9.152 | 55 | 8.627 | 76 | 5.657 |

35 | 9.145 | 56 | 8.572 | 77 | 5.443 |

36 | 9.136 | 57 | 8.512 | 78 | 5.229 |

37 | 9.126 | 58 | 8.446 | 79 | 5.018 |

38 | 9.116 | 59 | 8.371 | 80 | 4.812 |

39 | 9.103 | 60 | 8.287 | 81 | 4.611 |

40 | 9.090 | 61 | 8.194 | – | – |

### Interest Calculated in Commutation Table

The Commutation Table now includes interest calculations due to the recommendations of the sixth Central Pay Commission. The amendments will be applied retrospectively from the date the Commission’s recommendations were implemented. This change will not cause any harm to any individual. The revised table will be used for pension commutations that became absolute from September 2, 2008, while the old table will be used for commutations that happened from January 1, 2006, to September 1, 2008. However, the new table will apply to commutations of additionally commutable pensions resulting from retrospective pay and pension revisions for such pensioners. The calculations are based on LIC (94-96) Ultimate Tables and an 8.00% interest rate.

**[Basis: LIC (94-96) Ultimate Tables and 8.00% interest]**

### Calculation of Commutation Factor of Pension with Eligibility – Illustration

An illustration for the calculation of the commutation factor of a pension with eligibility is available. It states that all pensioners have the chance to exchange a part of their monthly pension for a one-time lump sum payment. This exchange is for the commuted value of the said pension part. However, if an employee or pensioner has ongoing departmental or judicial proceedings, he or she cannot avail the said exchange until such proceedings are finished.

### Maximum of Commutation Portion 40%

The highest allowable amount for commutation is 40% of the monthly pension, with any partial amounts disregarded. To calculate this, a commutation factor is taken from a table relevant to the person’s age at their next birthday. To determine the lump sum payment, the following formula is used. For example, if the monthly pension is Rs. 24,500, the maximum commutation amount permitted would be Rs. 9,800 (calculated as 24500 x 40/100).

The formula for working out the lumpsum payable is as follows.

**Amount of pension offered for Commutation x 12 x Commutation factor**

The formula for determining the amount of pension offered for commutation is to multiply it by twelve and the commutation factor. The following two examples are given in accordance with the commutation of pension rules. For instance, in Illustration 1, an employee who retired in July 2018 with a basic pension of Rs. 24,500, receives an amount of pension offered for Commutation of Rs. 9,800 with a commutation factor of 8.194. The lump sum payable would be Rs. 9,63,614(rounded off). In Illustration 2, a Pensioner will receive Rs. 510 as the amount of pension offered for commutation with a commutation factor of 9.81, resulting in a lump sum payable of Rs. 60,037 (rounded off). The pension amount will be reduced from the date of receiving the commuted value by the pensioner or from the end of three months after the issuance of the authority for payment. However, after completing fifteen years, the commuted portion of the pension can be restored with an application to the pension disbursing authority.

### Anomalies in Commutation of Pension

The Secretary of the Department of Pension & Pensioners’ Welfare has received a letter from the General Secretary of Central Government Employees Confederation regarding anomalies in commutation of pension. The commutation table has not been revised since 2008 with an interest rate of 8% compounded annually. However, due to the lowering of interest rates by the Central Government and LIC within the last five years, it is imperative that the commutation table undergoes revision. As the third commutation table is due to be released from January 1, 2018, the letter requests prompt action to address the issue.

A proposal has been made to reduce the commuted portion of pension from 15 years to 12 years, factoring in interest, risk, and a life expectancy of 70 years. To achieve this, there is a need for a revision of the current commutation tables. The first table, effective from 1.3.1971 to 1/9/2008, has an interest rate of 4.75%, while the second table, effective from 2/9/2008 until now, has an interest rate of 8%. Commutation tables should be revised every decade, and a third table is due from 1/1/2018 with an interest rate of 6.5%. Due to the lowering of interest rates in recent years, a new Commutation Table – 3 and Commutation Value should be created effective from 1/1/2018 for both the government and LIC pension policy. Various government schemes and their interest rates have been studied in relation to this proposal.

### Commutation Calculation Formula with Example for Bank Employees

Bank employees who retire with a superannuation pension or other types of pensions are entitled to commute a maximum of one-third of their pension for a lump sum payment, which can be restored after fifteen years. If the commuted value of pension cannot be paid within the first month after retirement, the difference between the normal monthly pension and the commuted pension will be paid. If a pensioner applies for commutation of pension after one year from the date of their retirement, a medical examination will be required. The lump sum payable is calculated according to the Table.

### Commutation Values for a pension of Re. One per annum

# Commutation value expressed as the number of year’s purchase

Age Next Birthday | Commutation value |

17 | 19.26 |

18 | 19.20 |

19 | 19.11 |

20 | 19.01 |

21 | 18.91 |

22 | 18.81 |

23 | 18.70 |

24 | 18.59 |

25 | 18.47 |

26 | 18.34 |

27 | 18.21 |

28 | 18.07 |

29 | 17.93 |

30 | 17.78 |

31 | 17.62 |

32 | 17.46 |

33 | 17.29 |

34 | 17.11 |

35 | 16.92 |

36 | 16.72 |

37 | 16.52 |

38 | 16.31 |

39 | 16.09 |

40 | 15.87 |

41 | 15.64 |

42 | 15.40 |

43 | 15.15 |

44 | 14.90 |

45 | 14.64 |

46 | 14.37 |

47 | 14.10 |

48 | 13.82 |

49 | 13.54 |

50 | 13.25 |

51 | 12.95 |

52 | 12.66 |

53 | 12.35 |

54 | 12.05 |

55 | 11.73 |

56 | 11.42 |

57 | 11.1 |

58 | 10.78 |

59 | 10.46 |

60 | 10.13 |

61 | 9.81 |

62 | 9.48 |

63 | 9.15 |

64 | 8.82 |

65 | 8.5 |

66 | 8.17 |

67 | 7.85 |

68 | 7.53 |

69 | 7.22 |

70 | 6.91 |

71 | 6.6 |

72 | 6.3 |

73 | 6.01 |

74 | 5.72 |

75 | 5.44 |

76 | 5.17 |

77 | 4.9 |

78 | 4.65 |

79 | 4.4 |

80 | 4.17 |

81 | 3.9 |

82 | 3.72 |

83 | 3.52 |

84 | 3.32 |

85 | 3.13 |

Bank employees can commute up to 1/3rd of their basic pension. The commuted portion of the pension is deducted from the total pension after payment. For SBI employees, the basic pension is calculated using a formula based on the average monthly salary, PQP, and FPP.

## What is the 7th CPC New Table for Commutation of Pension?

The 7th CPC New Table for Commutation of Pension is a table that provides the full pensions payable to retired Government Employees in India as per the Seventh Central Pay Commission.

## Where can I find the 7th CPC New Table for Commutation of Pension?

The 7th CPC New Table for Commutation of Pension can be found on the Central Government website.

## How is the Commutation Table used?

The Commutation Table is used to calculate the lump sum amount that an employee is eligible for. The formula for calculating the value is 0.4 (Maximum) x Pension x Commutation Factor x 12, effective from 1.3.1971.

M Ayub says

Can I apply for Commutation of Pension after one year of my retirement. If so, How to apply.

M.K.KUMAR says

Yes. As usual in your previous office. But you will loose interest of one year (F.D.rates applicable) of your total commutation amount.

Abdul Mazid Ansari says

My date of birth is 01/01/1962. Retired on 31/12/2021 and next birth date is 01/01/2022.

Which age will be consider to calculate as per commutation table 61 years and factor ie 8.194, or 60years and factor 8.287 ?

My office calculated as age 61 and factor 8.194. Why did not calculated by age 60 and factor 8.287? Because I was retired on next birth date ie. 01/01/2022 and not performed the duty. then such case I am eligible to calculation of 60 year and factor 8.287 should be applied in place of factor 8.194.

M.K.KUMAR says

It is correct. Commutation Factor for Superannuation – 8.194 completed 59 years is 60 years i.e. including first born day (one month is completed 30 days as calculation)

You may check with this :http://7thpaycommissionnews.in/guidelines-for-pensioners-commutation-of-pension/

M Dijomani singha says

Sir me date 30april2018ko out howa he Mera aabhitak commuted nahi mila .mera army no 15476566f Ppo no 151201800484 he pls sir muje paise ki bahot jarurat he .pls sir

M.K.Kumar says

Pay is only basic, emolument is total including all allowances/reliefs

Sudarshan says

What is the difference between emoluments and pay

D P S YADAV says

emoluments includes allowances

Dinesh Jain says

I was retired on 31.01.2018. DA rate was declared to increased 5% to 7% in last of march, is commutation will be increased after this change of DA rate.