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I want to pay more into the Scheme

The Local Government Pension Scheme (LGPS) provides a generous pension, but there are many reasons you might want to increase the benefits you'll receive at retirement.

Perhaps you’d like to be able to retire earlier, or you feel you need to compensate for a career break. Maybe you’d just like a higher standard of living when you retire.

There are two main ways to increase your retirement benefits in the LGPS:

  • You could pay Additional Pension Contributions (APCs)
  • You could pay Additional Voluntary Contributions (AVCs) to the EAPF’s In-House AVC providers, Prudential and/or Standard Life

Please note: the value of any in-house AVC plan you have may fluctuate in accordance with your chosen investment fund and market volatility. It may be worth keeping a close eye on the fund(s) you have chosen to invest in. You do also have the option to amend your investment fund choice at any time.

If you were buying added years or additional pension via Additional Regular Contributions (ARCs) on 31 March 2014, then you could carry on with these after this date, but you cannot enter into any new added years or ARC contracts, as they've been superseded by APCs.

Remember that you benefit from tax relief at your marginal rate of tax if you choose to increase your pension benefits by either of these options, but you should think carefully about any decision to pay extra contributions, and you may wish to take independent financial advice.

You can find a list of independent financial advisers in your area at www.moneyadviceservice.org.uk

You'll find more details about paying AVCs in our Topping up my pension factsheet.

Last updated: 26/03/2024

Additional pension contributions (APCs)

APCs allow you to buy additional pension which is paid with your annual pension when you retire. 

You can buy additional pension by paying APCs regularly, over a period of time, or you can buy additional pension by paying in a one off lump sum.

If you choose to spread the payments, then additional contributions are deducted from your pay and attract automatic tax relief.  If you choose to pay a one off lump sum, this will normally be deducted from your pay with tax relief at source. However, you have the option to make a one off lump sum payment directly to our pension fund administrators, Capita, and if you choose this option you'll need to reclaim the tax relief by filling in a HMRC Self-Assessment tax return. You’ll find more details about completing a Self-Assessment tax return by visiting the www.gov.uk website.

The cost of buying additional pension will depend on how much you want to buy, your age when you start paying and the length of time over which you want to buy it.

The additional pension that you buy will increase in line with the cost of living each year.

You can also use this facility to make up unpaid leave that occurred on or after 1 April 2014, so if you have a period of unpaid maternity, paternity, or adoption leave, you can elect to pay APCs to make up for the pension ‘lost’  during this period. If you elect to pay within 30 days of returning to work, your Fund employer will pay two-thirds of the cost. This is known as a shared cost APC.

In addition, any period of unpaid leave, if not bought back, will affect any 85 year rule and statutory underpin protections that you may have. Please contact Capita for more information on how this affects your protections.

How do I find out more about APCs?

If you’re interested in APCs, you can get a quote from the Local Government Pension Scheme (LGPS) website. This should help you make your decision. If you decide to buy additional pension, you can complete the application form on the website.

The largest amount you can pay as an APC is 100% of your pensionable pay, minus your standard Scheme contribution. If, based on your salary history, your Fund employer thinks that you won’t be able to meet your APC payments, they can pass your case to the EAPF which will decide if your application will be accepted. Alternatively, if your monthly APC payment would be very small, the EAPF may decide that you will need to make a lump sum payment instead.

If you decide to pay APCs on a monthly basis, payments will commence from the start of the pay period following your election to pay APCs. Monthly APCs are a fixed amount, and are not index linked. Any additional pension you buy is increased in line with the cost of living. If you wish to pay APCs after reaching your normal pension age (NPA), you may only pay one off lump sums. You can stop paying APCs by writing to the EAPF. If you stop being a contributing member, any APCs you're paying will stop automatically. Before you can pay APCs, you must get a medical report confirming that you're in good health.

Please note that if you're a member of the 50:50 Section you can only take out an APC to buy back any pension ‘lost’ during a period of unpaid leave. You can find more details about the 50:50 Section on our 50:50 Section page.

What can I get from my APCs?

If you retire before your Normal Pension Age (NPA), your additional pension will be reduced for early payment. If you retire after your NPA it will be increased for late payment.

You can exchange any additional pension for a lump sum when you come to retire, just like the rest of your pension. If you pay APCs monthly and you leave the LGPS, you'll be credited with the proportion of additional pension that you've paid for. If you pay APCs monthly and retire on the grounds of Tier 1 or Tier 2 ill health, you'll be credited with the full amount of additional pension you were buying, without reduction for early payment. For more details about ill health retirement, see our ill health page.

In-house additional voluntary contributions (IHAVCs)

To get additional benefits when you retire, you can make payments to Standard Life or Prudential , the EAPF’s in-house AVC providers. You can make these payments straight from your salary and they attract tax relief in the same way as your other pension contributions.

The EAPF’s in-house AVC providers invest any money you pay into a personal account. Over time, this builds up with your contributions and investment returns. You'll be able to choose how your money is invested, as each provider offers a range of different funds to invest in.

Previously, Clerical Medical and Equitable Life acted as in-house AVC providers to the EAPF. If you have an existing arrangement with either, it won’t change, but they're now closed to new contributors.

To contact any of the in-house AVC providers mentioned above, see our Who do I contact about in-house AVCs? page.

If you decide to pay IHAVCs, your payments will begin from your first pay period after your application is accepted, and you can change or stop your payments at any time. The EAPF may specify a minimum payment amount, though the maximum amount you can pay is 100% of your pensionable pay, minus your standard Scheme contribution.

If you transfer any other LGPS pension into the EAPF, you may have to also transfer any previous IHAVC into the EAPF and stop paying into your previous arrangement. See our Transfer in page for more details about transferring a pension to EAPF.

What can I get from my IHAVCs?

When you come to retire, you can:

  • Use your IHAVC pot to buy additional pension from the Local Government Pension Scheme (LGPS)
  • Use your IHAVC pot to buy an annuity, either with the company the IHAVCs were invested with or another insurance company, bank or building society, using the open market option
  • Transfer your IHAVC pot to another pension provider, to be used in accordance with the new pensioner provider's scheme rules
  • Take up to 100% of your IHAVC pot as a tax free lump sum. You can only do this if you take it at the same time as your other LGPS benefits and it falls within His Majesty's Revenue and Customs (HMRC) limits

If you're over 50, began paying IHAVCs before 13 November 2001, and you've remained a contributing member of the LGPS ever since, you may be able to convert your AVCs into LGPS membership before you retire. You can also pay IHAVCs to increase your death in service cover.

If you use your IHAVC pot to buy additional pension, your dependants may be eligible to continue to take some of it after your death. For more details about death benefits, see our death and dependants’ page.

If you do decide to pay IHAVCs for additional death benefits, you may have to complete a medical questionnaire and undergo a medical examination before your application is accepted.

To contact our in-house AVC providers please visit our Who do I contact about in-house AVCs? page.

Who do I contact about in-house AVCs?

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For more information with regards to paying in-house additional voluntary contributions (IHAVCs).
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