What is EPA?

EPA is a way to build up a portion of your alpha pension that can be paid earlier than your alpha Normal Pension Age (NPA), without any reduction.

How does EPA work?

You contribute to an EPA directly from your pay, in addition to your normal alpha contributions.

When you contribute to an EPA you build up an EPA portion of your alpha pension that is just like the main alpha pension. This builds up pension at 2.32% of your pensionable earnings for each year of scheme membership.

The EPA portion of your pension can be claimed a number of years before your alpha NPA without an early payment reduction depending on the EPA option you have selected.

It is only the EPA portion of your pension you build up (while contributing to an EPA) that can be paid in full before your NPA.

Can I buy an EPA portion of my pension?

Not everyone can buy an EPA, you must:

  • be an active member of alpha

and

  • not have bought the maximum added pension in alpha.

What options can I choose from?

You can choose an EPA option that can be paid a specified number of years before your alpha NPA without reduction. These options are:

  • one year earlier (alpha NPA minus one)
  • two years earlier (alpha NPA minus two)
  • three years earlier (alpha NPA minus three).

Age 65 is the earliest an EPA portion of an alpha pension can be paid without reduction. This may restrict the options you can choose from.

For example, if your alpha NPA is 67, you cannot choose an EPA option of NPA minus three, because that EPA portion could be paid without reduction before age 65.

If you are close to your NPA you must also note that you cannot select an EPA option that could be paid without any early payment reduction earlier than your current age.

For example, if your alpha NPA is 68, and you are age 66, you cannot select an EPA option of NPA minus three as this could be paid without early payment reduction from age 65 which is earlier than your current age.

What if I have a State Pension age (SPA) with a part year?

Your alpha NPA matches your SPA, so this can also include a part year, like 67 years and eight months or 66 years and six months. This will affect the EPA options you can choose.

For example, if your NPA is 67 years and six months you cannot choose an EPA option of NPA minus three, because that EPA portion could be paid without reduction before age 65.

However, because of the part year in your NPA there is a special option available, you may be able to choose an age 65 EPA option.

You are not buying a fixed age EPA. If in the future your SPA changes, the age 65 EPA option will be adjusted.

What if my State Pension age (SPA) changes?

Your alpha NPA is linked to your SPA, and SPA can change.

When you select an EPA option, you choose a number of years before your alpha NPA.

If your SPA changes, this will affect your alpha NPA. this means that the age that the EPA portion of your alpha pension can be paid in full changes too.

For example, if your alpha NPA was 67 and you chose an EPA option of your alpha NPA minus two, this EPA portion of your pension could be paid without any reduction from age 65 (two years before your alpha NPA).

If your SPA changes to 68, your alpha NPA changes too, and the EPA portion of your pension could only be paid in full from age 66. This is still two years before your alpha NPA.

You may have been able to choose an age 65 EPA option if you have a SPA with a part year (eg 67 years and six months). If your SPA changes, your alpha NPA changes too. Any EPA portions of your pension will be payable without any early payment reduction the same number of whole months before your NPA.

For example, if your NPA is 67 years and six months you may have chosen the age 65 EPA option that was available, this would be payable without reduction from age 65, which is two years and six months before your NPA. If your SPA changes to 68, your NPA changes with it. The age 65 EPA option will automatically become an NPA minus two years and six months EPA option.

This EPA portion of your alpha pension is now payable without any early payment reduction from age 65 years and six months.

When can I buy an EPA portion of my pension?

You buy an EPA portion of your pension by making regular monthly contributions from your pay. These always start on 01 April each year, and you must apply before the annual deadline that Civil Service Pensions will tell you each year.

You can apply at any time, but your option will not start until the start of the next scheme year (01 April).

You can apply to buy an EPA portion of your pension from your alpha start date, if you apply within three months of joining alpha. Your EPA option will be backdated to your start date, so you might have to pay some backdated contributions.

How much does it cost?

The cost will vary. We have produced an estimator that will be made available on the Civil Service Pensions website to allow you to see what the cost will be in the current year.

EPA contributions are higher than ordinary alpha contributions. The earlier you want to access your full pension, and the older you are, the higher the contributions will be.

An EPA option will normally start at the beginning of the scheme year (01 April), or from your start date if you are a new joiner and apply within three months of joining.

By signing the application you are agreeing to pay your EPA contributions until the end of the scheme year (31 March).

How do I pay?

Your contributions are taken direct from your pay, in the same way as your normal alpha contributions.

How do I apply to buy an EPA portion of my pension?

Once you have chosen which of the EPA options you want to buy, you will need to complete an EPA application. The application form is available on the forms page of the Civil Service Pensions website.

If you do not change or cancel your EPA option you will continue to make contributions and build up an EPA portion of your pension into the next scheme year.

The cost of buying an EPA portion of your pension will usually increase each year as you get older. The Scheme Administrator (MyCSP) will send you information before each new scheme year telling you about any changes to your EPA contributions.

Can I cancel my EPA option?

Yes. Your cancellation will take effect at the end of the scheme year (31 March).

What happens to the EPA portion of my pension if I cancel?

You will stop paying the EPA contributions at the end of the scheme year, and return to only paying the ordinary alpha contributions, building up a pension that can be paid in full at your alpha NPA.

If you stop adding to the EPA portion of your pension it is held on your record alongside your main alpha pension.

Each year the EPA portion of your pension you have built up is adjusted in line with prices, at the same rate as the main alpha pension.

You can re-apply and start adding to this EPA portion of your alpha pension again at a later date.

Each portion could be reduced for early payment, paid in full, or increased for late payment differently, as each portion can be paid in full from a different age.

What happens to the EPA portion of my pension if I leave alpha?

Your EPA option is cancelled immediately on the day you leave. You keep the EPA portion of your pension that you have built up, unless you are leaving with less than two years’ service and you are eligible for a refund of all of your pension contributions, or a transfer out of the benefits you have built up. Your EPA contributions will be refunded or the EPA pension will form part of the transfer out, depending on which option you choose.

What if I re-join alpha?

If when you left, the EPA portion of your pension was cancelled, when you re-join it can be restarted automatically depending on the length of your break in service.

Your EPA option will automatically restart if you re-join alpha in five years or less. If this is the case, you will start making your EPA contributions immediately on re-joining. If you do not want to restart your EPA option, you must tell your employer as soon as possible after re-joining.

Can I change my EPA option?

Yes. When you change an EPA option, you are cancelling the original and replacing it with a new EPA option. This means that changes can only take effect from the start of the next scheme year (01 April). The Scheme Administrator (MyCSP), will tell you the deadline for making changes.

What happens to the EPA portion of my pension if I change my EPA option?

You stop building up the original EPA portion of your pension, and instead start building up another separate EPA portion.

Can I have more than one EPA option?

Yes. Over a number of years, you can build up different EPA portions of your pension, but you can only contribute to one EPA option at a time.

It is possible to have a pension under each of the three EPA options, and some pension in your main alpha pension too.

When you claim your pension, your main alpha pension and any EPA portions will come into payment at the same time. Each portion could be reduced for early payment, paid in full, or increased for late payment differently, as each portion can be paid in full from a different age.

If I have more than one EPA portion of my pension, can I claim them separately?

Partial retirement lets you claim part of your alpha pension; you can choose to only claim the EPA portion (or portions) that you have built up. This leaves your main alpha pension to be claimed when you fully retire. There is more information on options you will have in Section 05B - Partial retirement.

What if I claim an EPA portion of my pension early or late?

Just like the main alpha pension, the EPA portion of your alpha pension can be claimed from minimum pension age. This is currently age 55 in alpha.

If the EPA portion of your alpha pension is paid earlier than your chosen EPA age, it will be reduced for early payment. If the EPA portion of your pension is claimed later than your chosen EPA age, it will be increased for late payment. See Sections 02E and 02F for more details on late payment and early payment.

What if I continue working until my alpha NPA?

If you continue working after the date the EPA portion of your alpha pension could be paid in full, you cannot continue to contribute to it.

Your additional EPA contributions will cease on your birthday, and you will only make payments to, and build up, the main alpha pension only.

Do I get any tax relief?

Yes. You get tax relief on your EPA contributions just like your normal alpha contributions. Your employer applies your tax relief by taking your contributions before the tax on your pay is worked out.

Are there any other tax implications?

Yes. All your pension and lump sum benefits count as using up part of your Lifetime Allowance (LTA). If the total value of your pensions from all pension schemes exceeds your LTA you will need to pay an additional tax charge.

LTA information can be found in Section 07A - Your pension and tax or on the HM Revenue & Customs website.

Published:
9 December 2021
Last updated:
29 June 2022