You can pay for additional pension either by regular contributions or by lump sum. The cost depends on:
- your age at the date the lump sum is paid or the contributions start
- the period you wish to pay over
- your normal pension age
You can calculate the cost of buying additional pension using the APC calculator. This calculator allows you to consider the cost over various payment periods.
If you decide to pay by regular contributions the contract must be for at least one full year or a full number of years. Contracts may be subject to a minimum monthly contribution rate set by NILGOSC.
You cannot start to buy additional pension with regular contributions if you are within one year of your normal pension age. However, you could still pay by lump sum.
Shared Cost Additional Pension Contributions (SCAPCs)
If your employer chooses to contribute towards the cost when you are buying additional pension to increase your benefits, this is known as a Shared Cost Additional Pension Contribution (SCAPC) contract. This is an employer discretion and you can ask your employer about its policy on Shared Cost APCs.
You can transfer AVCs or Free-Standing AVCs into the Scheme to buy extra Scheme pension. You have only 12 months to opt to transfer your AVC benefits unless NILGOSC allows you longer.
A transfer request form, LGS8, and a Public Service Pensions History Form, LGS10, can be found on My NILGOSC Pension Online. These forms should be completed and returned to NILGOSC within one month of receiving your membership letter. NILGOSC will then contact your previous pension provider for a transfer quotation. On receipt of this, NILGOSC will provide you with a transfer acceptance form stating the benefits that we will provide you with if the transfer proceeds. If you wish to transfer you should complete the transfer acceptance form and return it to NILGOSC. It is important that this form is returned within 12 months of your date of joining the Scheme. NILGOSC will then request payment from your previous provider. We will write to you to confirm the benefits the transfer payment has brought.
Please contact NILGOSC directly if you need more information.
If you have paid into another pension scheme you may be able to transfer these benefits into the Scheme. The other pension scheme must be another registered pension scheme or from a European pensions institution.
You have only 12 months from joining the Scheme to elect to transfer your previous pension rights or such longer period as NILGOSC may allow.
If you elect to transfer your pension rights from a non-LGPS arrangement then a sum of money called a transfer value is offered to buy you an amount of extra pension that is added to your pension account. The extra pension is added to your pension account in the year that the transfer payment is received.
You will need to consider carefully whether to transfer or not as a transfer may not always be in your best interests. You may wish to seek the help of an independent financial adviser.
NILGOSC does not have to accept a transfer in and can decline it.
Providing you have not had a break of more than five years between leaving another public service pension scheme and joining the Scheme and the election to transfer is made within 12 months of joining the Scheme, the transfer may be dealt with under Club Transfer rules.
The amount of extra pension which is added to your pension account will be equal to the amount of pension you had built up in your pension account in the previous scheme. The extra pension is added to your pension account in the year it is received.
If the transfer from the other public service pension scheme also includes a final salary element (usually in respect of membership up to 31 March 2015) that element will buy final salary scheme membership in the Scheme, providing you have not had a continuous break in active membership of a public service pension scheme of more than five years. The transfer value will give you broadly equivalent benefits in the Scheme providing you apply for the transfer within 12 months of the joining the Scheme.
Transfers from other public service pension schemes that operate in the Public Sector Transfer Club can result in service credits that are of greater value in the LGPS (NI) than they were in the previous scheme. The increase in the value of benefits is likely to be significant if there is a large increase in your salary when you left your old employer compared to your salary with your new employer. This growth in benefits must be tested against the annual allowance for pension savings purposes. It is your personal responsibility to declare any tax liability arising from this on your self-assessment form.