To opt out of the NHS Pension Scheme in England and Wales, you complete Part 1 of the NHS pension opt-out form SD502, hand it to your employer’s payroll department, and they complete Part 2. Contributions stop from the first day of the next pay period after payroll receives the form. GPs in England use a different route: the PCSE Online portal, not the paper SD502.
Where to Get the Form
Download the current SD502 from the NHS Business Services Authority website.1NHSBSA. Leaving or Taking a Break From the Scheme It is a PDF and NHSBSA updates it periodically, so grab the latest version rather than reusing an older copy. The form has two parts: Part 1 for you, Part 2 for your employer. There is no Part 3.
GPs in England do not use the paper SD502. Log into PCSE Online, open the GP Pensions tab, select Opt Out, enter the date you want the opt-out to start, and confirm.2Primary Care Support England. Opt In/Out of the Pension Scheme GPs in Wales send their SD502 to their Local Health Board rather than a payroll department.3NHS Business Services Authority. NHS Pension Scheme Application to Leave (SD502)
Filling Out Part 1
Part 1 asks for your title, full legal name (including any former surname), date of birth, National Insurance number, gender, employer name and address, email, postcode, and payroll number. It also asks whether this is your first NHS job.3NHS Business Services Authority. NHS Pension Scheme Application to Leave (SD502)
Get your payroll number from a recent payslip. It is not the same as your National Insurance number, and mixing the two is a common mistake that slows processing.
Below the personal details sits the declaration. By signing, you confirm that you wish to opt out of pension saving, that you understand you will lose employer pension contributions, that you understand you may have a lower income in retirement, and that you understand you cannot opt out retrospectively.
That last point catches people off guard. You cannot backdate the opt-out to cover pay periods that have already passed. The one exception is the first-month window: if you complete and return the SD502 within your first month of NHS employment, you can opt out from the start of that employment, and your employer may refund the first month’s contributions.4NHS Business Services Authority. Can I Get a Refund of My NHS Pension Contributions Miss that window and the opt-out only runs forward.
Submitting the Form
Sign Part 1, keep a copy for yourself, and deliver the form to your employer’s payroll department. Do not send it directly to NHS Pensions. They will not process it, and you will have wasted time.3NHS Business Services Authority. NHS Pension Scheme Application to Leave (SD502) Payroll then fills in Part 2, which records the employer’s details and confirms your pension status has changed. The employer retains the completed form.
Pension deductions stop from the first day of the next pay period after payroll receives the form. Check your next payslip to confirm the pension contribution line has disappeared. If deductions continue, contact your payroll officer straight away. Your copy of the signed form is your proof of when you submitted it.
The SD502 Does Not Trigger a Refund
The SD502 is purely an opt-out form. If you want your contributions back, you submit a separate RF12.3NHS Business Services Authority. NHS Pension Scheme Application to Leave (SD502)
You qualify for a refund only if you have less than two years of qualifying membership in the scheme (including membership from previous sections), you left before your normal pension age, you have not transferred in from a personal or stakeholder pension, and you have not already claimed any pension benefits.4NHS Business Services Authority. Can I Get a Refund of My NHS Pension Contributions With two or more years of qualifying membership, no cash refund is available: your contributions stay in the scheme as a deferred pension, payable when you reach normal pension age.
Refunds are not paid in full. NHS Pensions first deducts a Contributions Equivalent Premium to buy you back into the State Pension for the period your NHS membership contracted you out. Income tax at 20% is then taken from the remaining amount, and refunded contributions above £20,000 are taxed at a higher rate.5NHSBSA. NHS Pensions Refund of Pension Contributions Factsheet Once NHSBSA receives your RF12, they aim to process the refund within one calendar month.6NHS Business Services Authority. Current Processing Times for NHS Pensions
What You Lose by Opting Out
Stopping your own contributions produces an immediate take-home pay boost, but it comes at a real cost. Your employer pays 23.7% of your pensionable pay into the scheme in England and Wales. That money is paid on top of your salary and stops the moment you opt out. No employer redirects the 23.7% into your pay packet; it simply disappears from your total compensation. For someone earning £35,000, that is roughly £8,295 a year in employer contributions you no longer receive.
Your own contribution rate depends on your pensionable pay band and ranges from 5.2% at the lowest band up to 12.5% at the highest.7NHSBSA. NHS Pensions Contribution Rates for 2025/26 These contributions come out of your gross pay before tax, so the actual take-home boost from opting out is smaller than the headline percentage suggests.
You also lose death-in-service cover. Active members who die while contributing receive a lump sum of twice their pensionable pay in the previous twelve months, paid to their surviving spouse, civil partner, or nominated partner. Once you opt out, any death benefit drops to a much smaller “death in deferment” amount based on the pension you had already accrued, which for someone early in their career may be almost nothing.
Rejoining, and Automatic Re-enrolment
If you change your mind, you can rejoin by notifying your employer. For most staff, that means asking payroll or HR to re-enrol you, and contributions typically restart from the next pay period. For GPs in England, the practice submits a Joiner form through PCSE Online.8Primary Care Support England. Joiners and Leavers
Even if you do nothing, you will likely be brought back in automatically. Under automatic re-enrolment rules, employers must put eligible staff who have left their pension scheme back into it every three years.9The Pensions Regulator. Re-enrolment and Re-declaration When that happens, pension deductions restart unless you submit a fresh SD502. If you want to stay out permanently, watch your payslips around your employer’s re-enrolment date; HR can tell you when the next cycle falls.
A Warning if You Hold Mental Health Officer Status
If you hold legacy Mental Health Officer status from before 6 March 1995, opting out creates a specific risk. MHO status is lost permanently if you have a break in pensionable employment of more than five years. Even a shorter break requires you to return to a role that qualifies for the status and rejoin the 1995 section of the scheme.10NHS Business Services Authority. Mental Health Officer Status Speak to NHS Pensions before submitting an SD502 if this applies to you. The early retirement benefits attached to MHO status are worth protecting.