If you take parental leave it is treated as authorised leave of absence for pension purposes.
If you are paid parental leave, you pay pension contributions on the pay you receive and build up your pension normally.
If you are unpaid, you can pay Additional Pension Contributions (APCs) for the lost pension. The cost of paying for lost pension is in accordance with guidance from the Government Actuary Department (GAD).
When you return from parental leave your employer writes to you to ask if you want to pay APCs for lost pension. They let you know the relevant timescales.
If you decide to pay APCs within 30 days the cost is shared between you and your employer. You pay one third (1/3) and your employer pays two thirds (2/3) of the cost. You can decide to pay after 30 days but you pay the full cost. There are deadlines restricting your decision and your employer lets you know this in their letter to you.
Not paying for lost pension
If you do not pay for lost pension during a period of unpaid parental leave, it does not count for pension purposes. The pension you build up in your account for that year is lower.
If you paid into the scheme before 1 September 2006, you may have protections under the 85 year rule. If you have a period of unpaid membership, it may delay the date you meet the 85 year rule.
If you are in your final year of membership in the scheme and you have membership before 1 April 2014, a lower final pay may affect your pension benefits.