COMMUTATION VALUE OF PENSION CALCULATOR 2018
“Pension commutation is a lifetime asset for Government employees. After completion of his Government service, more than 30 years, half of the lifetime, selling his 40% of the pension amount, an employee get a bulk amount while retiring”.
‘Commutation’ is not easy money for Government employees, not a git also”
What is Commutation?
Retiring Government employees has a choice to sell a part of his pension and get bulk amount as ‘Commutation’.
After implementation of 7th pay commission, there is no change in the calculation of commutation of pension.
|The formula for arriving for commuted value of Pension (CVP) is
CVP = 40 % x Commutation factor* x 12
* The commutation factor will be with reference to age next birthday on the date on which commutation becomes absolute as per the New Table annexed to the CCS (Commutation of Pension) Rules, 1981.
[Note : All the figures are indicative]
Calculation of Commutation of Pension: A Central Government servant has an option to commute a portion of pension, not exceeding 40% of it, into a lump sum payment.
No medical examination is required if the option is exercised within one year of retirement. If the option is exercised after expiry of one year, he/she will have to under-go medical examination by the specified competent authority.
Lump sum payable is calculated with reference to the Commutation Table. The monthly pension will stand reduced by the portion commuted and the commuted portion will be restored on the expiry of 15 years from the date of receipt of the commuted value of pension.
Dearness Relief, however, will continue to be calculated on the basis of the original pension (i.e. without reduction of commuted portion).
|7th CPC New Table for Commutation of Pension|