Pensionable service is one key factor in determining how much of a pension you will receive upon retirement. You have the option of buying service from times while you were away from work and not being paid, such as maternity or parental leave. This buyback option lets you reduce or close that gap in your pensionable service, and increases the amount of your future pension.
You have the option to make the payments during your leave or wait until you return to work. You are also allowed to use funds from a Registered Retirement Savings Plan (RRSP) or other retirement savings tools to pay for your buyback.
You can purchase up to three years of maternity or parental leave, and up to a maximum of five years of any other kind of leave. Additional years of maternity or parental leave can be applied to this five year limit.
For the first year of leave that you buy in PSPP, your employer pays the employer share of contributions with interest while you pay the employee share. Only the first year of leave in PSPP is cost-shared this way. For any additional leaves, you are responsible for paying both the member and employer share.