Missed your NPS contribution? Unfreeze your account with these steps

Business Standard

28-04-2025

Raj Mehta, a 34-year-old IT professional in Pune, had been investing in the National Pension System (NPS) for over five years. Like many working professionals, Raj saw NPS as a tax-saving tool and a way to build a solid retirement corpus. Every year, he would make his minimum annual contribution of Rs 1,000 to keep the account active.
However, last year was different. Between changing jobs, a busy wedding season, and moving to a new city, Raj forgot to contribute to his NPS account before the March 31 deadline. When he logged in to check his statement a few weeks later, he was shocked to find his account had been frozen.
What happened?
Raj's account was classified as "inactive" because he missed making the minimum annual contribution of Rs 1,000 in his Tier I account. As per NPS rules, this automatically freezes the account, making it impossible to make further contributions or access funds until it's reactivated.
"If you don't contribute at least Rs 1,000 in a financial year, your NPS account is marked as inactive or frozen. What does that mean? You lose access to the most basic features - no new contributions, no changes to your fund manager or investment plan, no nominee updates and no withdrawals. It's your retirement money, but it's out of your hands until you reactivate it," explains Aakar Rastogi of Value Research.
Why Is an NPS Account Frozen?
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An NPS account can become inactive or frozen for several reasons:
Minimum Contribution Lapse: If you fail to contribute the required minimum amount—₹1,000 annually for Tier I accounts—the account will be frozen. ​
Incomplete KYC Verification: Missing or incorrect Know Your Customer (KYC) documents can lead to account freezing. ​
Non-Submission of Enrollment Form: Not submitting the necessary forms to the Central Recordkeeping Agency (CRA) can result in a frozen account.
Inactivity: Prolonged periods without contributions or transactions can cause the account to become dormant. ​
Suspicious Transactions: Any unauthorized or suspicious activity may lead to a freeze for security purposes.
The good news? You can fix it in minutes.
How to unfreeze it
Raj quickly logged in to the CRA portal using his PRAN, such as Protean. Under the 'Contribute Online' tab, he found the 'Unfreeze Account' option. All it took was a small contribution - Rs 1000 - and a reactivation fee of Rs 100. He paid it via UPI, and the account was live again the very next day.
Step 1: Logged into the eNPS Portal
Raj visited https://enps.nsdl.com and logged in using his PRAN (Permanent Retirement Account Number).
He made an online payment of Rs 1000 as the current year's contribution and an additional Rs 100 as the penalty for missing the previous year. The portal provided a payment receipt instantly.
Step 3: Account Reactivated
Within five working days, Raj received a confirmation email stating his account had been reactivated. He could now continue investing and claim tax benefits under Section 80CCD(1B).
What Raj Learned—and What You Should Know
Minimum Contribution is Key: Always contribute at least Rs 1,000 a year to keep your NPS account active.
Track Deadlines: Setting up calendar reminders or auto-debits from your bank can save you from freezing issues.
Frozen Accounts Can Still Be Fixed Easily: Whether online or offline, reactivation is simple—you just need to make the required payments.
No Contributions = No Tax Benefits: Raj missed out on the Rs 50,000 additional tax deduction under 80CCD(1B) for the previous financial year because his account was inactive at the time of filing.
Rastogi explains this in detail:
People now often assume that under the new tax regime, the NPS had little to offer, since the additional Rs 50,000 deduction under Section 80CCD(1B) was no longer available. What many do not realise is that a key tax-saving provision under NPS still applies, regardless of the regime. Under Section 80CCD(2), if your employer contributes to your NPS account, you can claim a tax deduction of up to 14 per cent of your basic salary.
To understand the benefit, consider this: If your basic salary is Rs 12 lakh per year, an annual employer contribution of up to Rs 1.68 lakh (14 per cent of Rs 12 lakh) can be made to your NPS account and claimed as a tax deduction. This employer contribution is often part of your CTC (cost to company), and in many cases, can be adjusted within the overall salary structure. However, it requires active coordination with your employer.
"With the financial year just beginning, this is a good time to check with your HR or payroll team to see if this benefit can be included or activated as part of your compensation," Rastogi added.
Raj has now set up an auto-debit of Rs 1,000 every quarter just to ensure he never misses the minimum requirement again—even if he plans to invest lump sums later in the year.