Opting out of the pension scheme

If you opt out of your Civil Service pension, you’ll be giving up a range of valuable benefits to which you and your family may be entitled.

• A pension payable for life and fully guaranteed by the government
• A tax-free lump sum cash option upon retirement
• Generous employer contributions
• An ill health pension should you become too unwell to work
• Protection for your loved ones - should you die a spouse/partner/civil partner pension may be due and also children’s pensions, plus a death benefit lump sum if you die in service.

You’ll also lose the tax relief on the contributions you pay, so opting out may only result in a marginal increase in cash in your pocket each month. Although it may seem that you’re paying a large percentage of your pay towards your pension, your pension contributions are not taxed and therefore your contributions actually cost you less than the rate shown on your payslip. Your tax is worked out on your pay after your pension contributions have been taken. 

You’d break the final salary link to any legacy pension scheme (classic, classic plus, premium and nuvos), if applicable, unless you opt back into alpha within five years.

You can read the main scheme guides for more information on the benefits you will get by being a member of the Civil Service pension scheme. 

Your employer is responsible for arranging for your pension contributions to stop from your pay. They’ll arrange this with your payroll. Once they’ve arranged for your contributions to stop they’ll send your form to the Scheme Administrator. We’ll then calculate any benefits that you may be due.

You may be able to opt back in at a later date. Your employer will help you with this. 

Members who opt out can only choose to opt back in to the section of the scheme that they would have been in if they had not opted out. An opt in form must be completed and the option will take place from the next available pay period.

The Opting In form can be found on the member forms page.

Following the introduction of alpha from 1 April 2015, when a member chooses to opt back into the pension they may not be able to rejoin their previous scheme. Instead they may only be able to join the alpha scheme.

Please note: Under the automatic enrolment legislation, an employee is allowed to opt back into the CSP arrangements once in any 12-month period.

Your decision to opt out of the pension scheme will take effect shortly after your employer receives your form. For information on how long it can take to hear about your pension, please see the What to expect if you leave before Normal Pension Age.

If you leave or opt out within one month of being enrolled into the scheme, your employer will automatically refund any contributions that you have made, less a deduction for tax.

If you leave or opt out after one month but within three months, and are under normal pension age, your employer will automatically refund any contributions that you’ve made, less a deduction for tax.  This’ll happen if you don’t already have a qualifying preserved award in the Civil Service pension scheme or have not had a transfer value paid in from a personal pension. If you’re over normal pension age you’ll receive a pension award.

If you leave or opt out with more than three months but less than two years’ service, and are under normal pension age, you may be able to transfer the value of your pension to another scheme, or have a refund of your contributions, less a deduction for tax. This’ll happen if you don’t already have a qualifying preserved award in the Civil Service pension arrangements or haven’t had a transfer value paid in from a personal pension. If you’re over normal pension age you’ll receive a pension award.

If you’ve more than two years’ service your pension will be ‘preserved’ and held in the scheme until you claim it, or apply to transfer the value of your preserved pension to another pension scheme.

No. You will not be able to continue or restart any added years contracts that you have now if you opt-out and then opt-back in at a later date.  You’ll be able to buy added pension, which is an amount of extra annual pension that you can buy.  This is paid with your pension when you retire.

The Civil Service pension arrangements are covered by automatic enrolment. This means if you opt out, your employer will have to automatically put you back into a pension scheme on their automatic re-enrolment date (anniversary date). This occurs once every three years. If you’ve opted out within the 12 months prior to your employer’s ‘anniversary date’ you will not normally be re-enrolled until the next ‘anniversary date’.  

It’s also likely that if you change employers (or your contract changes) you’ll be automatically re-enrolled into the pension scheme.

If you are re-enrolled, and don’t want to stay in the scheme, you’ll need to complete another opt out form.  You’ll need to ensure that your employer receives your opt out form either within one month of you being automatically re-enrolled, or within one month of you being informed that you’ve been automatically re-enrolled (if later).

If you are re-enrolled and your employer receives your opt-out form outside the one month time limit they’ll forward the form to the Scheme Administrator.  We’ll then assess whether you are due a refund, a refund/transfer option or a preserved pension.

For more information about automatic enrolment, please speak to your employer.