Three ways to boost your NHS pension — Additional Pension (ERRBO), money purchase AVCs, and legacy Added Years. This guide explains each option, what they cost, and whether topping up makes sense for your specific tax position.
The NHS Pension Scheme offers several ways to build a larger pension at retirement. For locum doctors — who may have gaps in pensionable service from periods working through a limited company, career breaks, or years before joining the scheme — top-ups are a powerful tool to close the gap.
There are three main routes, though only two are currently open for new elections:
| Top-Up Option | Scheme | Status | What You Get |
|---|---|---|---|
| Additional Pension (formerly ERRBO) | 2015 scheme | Open for new elections | Extra guaranteed annual pension (up to £6,500/year) |
| Money Purchase AVCs | All schemes | Open for new elections | Investment-based pot — annuity, lump sum, or drawdown at retirement |
| Added Years | 1995/2008 schemes | Closed to new elections | Extra years of pensionable service (existing contracts continue) |
Additional Pension is the primary top-up route in the 2015 NHS Pension Scheme. It allows you to buy a guaranteed amount of extra annual pension on top of your standard accrual.
NHS Pensions uses actuarial factors based on your age at the start of the contract. The younger you are, the cheaper each pound of additional pension. This is because the scheme has more years to invest your contributions before paying out your pension.
| Age at Purchase | Approximate Cost per £1,000 Extra Annual Pension (Lump Sum) | Approximate Monthly Cost (to NPA 67) |
|---|---|---|
| 30 | £5,800 – £7,200 | £14 – £17 |
| 35 | £7,500 – £9,000 | £20 – £24 |
| 40 | £9,500 – £11,500 | £30 – £36 |
| 45 | £12,000 – £14,500 | £45 – £55 |
| 50 | £15,000 – £18,000 | £75 – £90 |
| 55 | £18,000 – £22,000 | £130 – £160 |
These are illustrative ranges. Exact costs depend on the actuarial factors in force at the time of your application. Request a personalised quote from NHS Pensions via the NHSBSA.
Dr Chen wants to buy £2,000 of additional annual pension via a lump sum.
Additional Pension purchases increase your pension input amount. If you are already close to the £60,000 annual allowance (or your tapered allowance), topping up could trigger a tax charge that wipes out the benefit. Always model the annual allowance impact before committing. Use our NHS pension calculator to check.
Money purchase AVCs are an investment-based pension that runs alongside your main NHS pension. Unlike Additional Pension, AVCs are not guaranteed — your pot grows (or shrinks) based on investment performance.
Many locum doctors benefit from a combination of both — Additional Pension to guarantee a base income, and AVCs for flexible capital. The right split depends on your age, risk tolerance, existing pension accrual, and tax position.
AVC contributions are added to your total pension input amount. Combined with your NHS pension growth and any Additional Pension purchases, total inputs must stay within your annual allowance to avoid a tax charge.
Added Years was the top-up mechanism in the 1995 and 2008 NHS Pension Schemes. It allowed you to buy additional years of pensionable service, increasing your final salary pension.
Do not cancel it without specialist advice. Added Years contracts locked in at historic actuarial factors often represent exceptional value compared to current Additional Pension rates. We regularly see locum doctors with 1990s-era contracts that would cost 3–5 times more to replicate today.
Locum doctors commonly have gaps — periods working through a limited company, overseas, or in non-NHS roles where no pension was accruing. Additional Pension is particularly valuable for filling these gaps, because it provides guaranteed pension that would otherwise be missing from your retirement income.
You can only buy Additional Pension if you are an active member of the NHS pension scheme. This means you must have submitted Type 2 forms and be currently contributing. If you've forgotten to submit Type 2 forms and aren't actively contributing, you cannot purchase Additional Pension until you resume contributions.
If your locum work is outside IR35 via a personal limited company, you likely aren't contributing to the NHS pension for those engagements — and you can't buy Additional Pension on non-pensionable earnings. Consider a personal SIPP instead for those income streams, and reserve Additional Pension purchases for periods when you're actively contributing via Type 2.
If you have unused annual allowance from the previous three tax years, you can make a larger lump sum Additional Pension purchase without triggering a tax charge. This strategy is especially powerful for locum doctors who had lower-earning training years with significant unused allowance. Read our comprehensive pension guide for full carry forward rules.
Tax savings from claiming allowable locum expenses can effectively fund pension top-ups. A doctor who reclaims £5,000 in expenses saves £2,000 at 40% tax — enough to fund regular Additional Pension contributions of £160/month, buying approximately £500–£700 of extra annual pension over 12 months.
Not every locum doctor should top up their pension. Use this framework to assess whether it makes sense for you.
| Scenario | Top-Up Recommendation | Reasoning |
|---|---|---|
| Under 45, higher-rate taxpayer, well below annual allowance | Strong yes — Additional Pension | Excellent actuarial value, full 40% tax relief, decades of CPI + 1.5% growth |
| Under 45, comfortable with investment risk | Consider AVCs | Long time horizon for equity growth, flexible access at retirement |
| Over 50, near the tapered allowance | Proceed with caution | Top-ups increase PIA, may trigger or worsen annual allowance charge |
| Already breaching annual allowance | Do not top up | The tax charge erodes or exceeds the benefit |
| Working through a limited company (outside IR35) | Consider SIPP instead | You may not be an active pension member; SIPP contributions are deductible from company profits |
| Significant gaps in pensionable service | Strong yes | Additional Pension fills gaps that would otherwise leave you with a lower retirement income |
| Existing Added Years contract | Keep paying | Historic factors almost always represent better value than current rates |
The interaction between top-ups, annual allowance, the taper, and your tax position requires specialist modelling. AccTek's annual pension review includes a top-up analysis for every locum client — checking whether Additional Pension, AVCs, a SIPP, or no top-up is optimal for your circumstances.
Yes. Active members of the 2015 scheme can buy Additional Pension (up to £6,500/year) or contribute to money purchase AVCs. You must be currently contributing to the scheme via Type 2 forms.
Up to £6,500 of extra annual pension per year for 2026/27. This limit is reviewed periodically by NHS Pensions.
Additional Pension provides a guaranteed, inflation-linked income for life with no investment risk. A SIPP offers flexibility and growth potential but carries market risk. For most locum doctors, Additional Pension is better value for the guaranteed element; a SIPP is better for flexible capital or if you cannot access the NHS scheme.
Yes. Additional Pension purchases and AVC contributions increase your pension input amount, which counts towards the £60,000 annual allowance. Model the impact before committing.
If you pay by regular contributions, you can stop at any time. You retain a proportional credit for the extra pension purchased so far. If you paid a lump sum, the full amount is locked in.
Almost always yes. Added Years contracts at historic actuarial factors typically represent far better value than current Additional Pension rates. Do not cancel without specialist advice.
Only if you are an active NHS pension member. If your locum work is paid through a limited company outside an NHS contract, you are unlikely to be contributing and therefore cannot buy Additional Pension. Consider a SIPP for those earnings instead.
Contact NHS Pensions via the NHSBSA website at nhsbsa.nhs.uk, or call their member helpline. They will calculate a personalised cost based on your age and the amount of extra pension you want to purchase.
Kishan Kedia analyses your pension position, annual allowance headroom, and top-up options as part of every AccTek locum client review — from £19.99/month.
This guide is for general information only and does not constitute pension, tax, or financial advice. Additional Pension costs shown are illustrative ranges only — request a personalised quote from NHS Pensions for exact figures. Always consult a qualified Chartered Accountant or independent financial adviser before making pension top-up decisions. Rates and limits are for 2026/27 unless stated otherwise.
Kishan Kedia ICAI, CAMS is a specialist accountant at AccTek with 20+ years of experience in locum doctor tax, NHS pension annual allowance, landlord tax, Section 24 planning and Making Tax Digital for Income Tax. He holds the ICAI qualification and is a Certified Anti-Money Laundering Specialist (CAMS).
