What does AVC mean on a payslip?
If you have a workplace pension, Additional Voluntary Contribution (AVC) and Free Standing Additional Voluntary Contribution (FSAVC) schemes, they allow you to increase the amount of benefits you receive at retirement by paying extra contributions.
What is a free standing AVC?
Free Standing Additional Voluntary Contributions The Additional Voluntary Contribution (AVC) bit means it’s an additional contribution above your standard workplace pension contribution. The “Free Standing” bit means that it’s not run by your employer and it’s managed by a provider of your choice.
Is AVCs worth paying?
Advantages of AVC pensions It should help you towards securing additional benefits for a better retirement. It could be cheaper than taking out an entirely separate personal pension. You have the flexibility to stop, start and amend contribution amounts when you want.
Are pension AVCs a good idea?
If you’re looking to build a strong pension pot, an AVC pension can be a great option. Even if your employer doesn’t offer a matched AVC pension, you can contribute as much or as little as you like every month. Quite simply, all the usual advantages of a pension apply to an AVC pension.
How do I claim tax back on AVC?
To make sure you are granted the correct relief you must enter your date of birth in the ‘Personal Details’ panel. If you are claiming relief for pension contributions in respect of an Additional Voluntary Contributions (AVCs) you claim the relief through the ‘PAYE/BIK/Pensions’ panel.
Can I withdraw money from my AVC?
You can take a once-off withdrawal of up to 30% of the value of your AVC fund, prior to retirement. This facility will only be available until 26 March 2016. Such a withdrawal will be subject to income tax at your higher rate, but is not liable for Universal Social Charge (USC) or Pay Related Social Insurance (PRSI).
Can I take my AVCs as a lump sum?
You can take some or all of your AVC fund as a tax-free cash lump-sum , but you can only take it all as a lump-sum if you draw it at the same time as your main LGPS benefits and provided, when added to your LGPS lump-sum, it does not exceed 25% of the overall value of your LGPS benefits (including your AVC fund).
How much of my AVC can I take tax-free?
Potentially up to 25% of your pot can be taken tax-free. The income you get is taxable. This option is also known as an annuity. You are only able to access your AVC benefits in this way at retirement or, subject to certain conditions, after retirement.
Are AVCs tax-free?
Your AVCs can be taken as part or all of the lump sum which you will normally be able to take when you start to draw your pension benefits. Under current legislation this lump sum is paid free of tax within HM Revenue & Customs allowances for those subject to UK tax.