Costing

Salary, rates of contribution, and age all affect the cost of buying back service. Depending on when you buy back service, different salary rates are used to calculate the cost.

If you complete, sign and forward a Service Buyback Form (PWGSC-TPSGC 3006) within one year of the issuance of your Notification of Plan Membership (PWGSC-TPSGC 2018), your buyback is considered to be a "normal" buyback. In this situation, the salary used to calculate the cost of buying back service is your salary on the date you most recently became a plan member.

If you complete and sign a Service Buyback Form after that one-year period, it is considered to be a "late" buyback. The salary rate used is the salary authorized to be paid on the date you signed the form. In many cases, this could cost you substantially more. For a "late" buyback, the form must be forwarded to the address indicated within one month of the date of signing.

Please note that you can use the same form to buy back more than one period of service. The costing may be different for each one depending on the factors indicated above and whether you previously had an opportunity to buyback the service in question under the public service pension plan.

Before buying back service you should obtain an estimate of what your prior service will cost. You can use the Compensation Web Applications (CWA) - Service Buyback Estimator or request an estimate from the Contact Us - Government of Canada Pension Centre. However, if your "normal" buyback expiry date is approaching you may want to consider buying back without an estimate.

The method used to determine the cost of a period of service is a contribution-based calculation. Contributions plus interest are calculated for the period of service based on the applicable salary rate.

Your contribution rate may be single or double. You may be required to pay both employee and employer contributions. For example, pensionable employment outside the federal public service is one type of service calculated at a double rate of contributions.

The cash cost of service is the lump sum amount payable at the time you are making the buyback. The cash cost of a buyback includes 4% simple interest, calculated from the middle of each fiscal year when the service occurred to the first day of the month in which you sign the form.

If you choose to pay your past service through monthly installments, the monthly amount is based on the cash cost plus additional interest and mortality charges.