How to transfer service between public sector plans
You may be able to transfer your eligible service if you are joining or leaving the plan.
If you leave your job, you may be able to transfer your service from your original pension plan to your new employer’s pension plan. You can do this if the two pension plans have a transfer agreement.
Things to think about when transferring service
Transferring service may allow you to:
- Increase your pensionable service and the value of your pension
- Increase your contributory service, which may allow you to retire earlier with an unreduced pension
However, it’s not always to your financial advantage to transfer service. It may be better to collect two separate pensions rather than transferring your service and collecting a single pension. This could be the case if:
- The total of the two separate pensions is more than a single pension after a transfer
- You can collect a pension earlier under your former plan
It's a good idea to talk with an independent financial adviser to help you decide if transferring service is a good choice for you.
Deciding not to transfer service
If you decide not to transfer your service from one pension plan to another, when you retire, you may receive a separate pension from each plan.
The pension you earn in any other plan will not affect the pension you earn with BC's Public Service Pension Plan.
Differences in pension service value between plans
The service you transfer from another plan may not have equal value in the Public Service Pension Plan, and vice versa. The reasons for this include different pension benefit formulas in each plan and salary differences between your old and new jobs. This means, when you transfer service between plans, the service you are credited for may not equal the service you accumulated while you were working.
If the value of the service transferred is less than the cost of buying the same service in the Public Service Pension Plan, there is a service shortfall.
You can pay for this service shortfall and be credited with full service. You must pay for a service shortfall in one lump sum and within a specific period.
If you do not want to pay for the service shortfall, you will be credited with pro-rated pensionable and contributory service based on the service transferred.
When you transfer service to the Public Service Pension Plan from another plan, the amount of contributory service we credit you will match the pensionable service we grant you.
How transferring service affects your pension
If you transfer service from your former pension plan to the Public Service Pension Plan, your eventual pension will be calculated using:
- The combined eligible service from all plans (this may be adjusted if there is a shortfall)
- Your five-year highest average salary from the Public Service Pension Plan
- The retirement age specified by the Public Service Pension Plan
What is the process?
If you're leaving an employer participating in the Public Service Pension Plan and would like to transfer your service to another plan that has an agreement with us, contact the new plan.
If you’re joining the Public Service Pension Plan and would like to transfer your service from your old pension plan, submit the Pension transfer application form. We’ll tell you if you are eligible and let you know how much service we'll credit to you from your former plan.
There are deadlines for transferring service; contact us as soon as possible so we can confirm your eligibility.
If you have a former spouse who is entitled to a share of your pension, the pension will need to be divided before any service can be transferred. Contact us for more information.
There may be tax implications associated with transferring service. You may wish to speak with an independent financial adviser before making your final decision to transfer eligible service between plans.