How To:
Buy Back Past Service

If you are an active member*, you may be able to increase your credited service in the OMERS Plan by buying back past service. Purchasing past service increases your pension and may help you retire earlier without a reduction.


Service
Some examples of service you can buy back include:
  • A leave period where the purchase deadline has passed
  • Refunded service after 1991 with another registered pension plan
  • A waiting period to join the OMERS Plan
  • Previously refunded service in the OMERS Plan



    • What does it mean for my pension?
     The longer you contribute or the more you purchase, the bigger your pension.
    How to Get a Costing
     To find out how much it may cost you to buy back past service, you can request a costing using the Buy-back Calculator in myOMERS or by contacting OMERS Member Services.


    		Calculating the Cost
    The cost is an actuarial calculation and tends to increase as you get older, which reflects the increasing value of the benefit. Some of the factors that determine the cost are:
  • Age
  • Salary
  • When the service occurred


    		•   Income Tax
    The cost may be tax-deductible and may affect your RRSP contribution room, depending on:
  • The type of service
  • When it occurred
  • How you pay for it


    • The tax deduction generally applies in the year the payment is made; some deductions may have to be carried forward to apply in subsequent years, depending on when the service occurred.

    		Payment
    There are many different payment options that make it easy to complete a buy-back. You can:
  • Transfer from a registered retirement savings plan (RRSP)
  • Pay by personal cheque made payable to OMERS – OMERS will issue a tax receipt
  • Transfer from another registered pension plan (RPP)
  • Use your OMERS Additional Voluntary Contributions (AVCs)
  • Set up pre-authorized monthly payments over 12, 24 or 36 months

    • Deadline
     The cost of service will remain in effect for 6 months – both funds and required documents must be received prior to the expiry date. Remember, transferring funds from your financial institution takes time. Be sure to initiate the transfer well in advance of the expiry date and follow up with the financial institution to ensure the request is completed.

    After the expiry, the cost will need to be recalculated, which will likely be higher. If you are completing a buy-back and leave your OMERS employer or retire, you must complete the purchase within 30 days.

    For more information on the difference between credited and eligible service see What’s the Difference? in this issue.

    * Active member: An OMERS member who is currently working for a participating employer and accruing credited service in the Plan. This includes members on a leave of absence or disability leave.
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