AVC - Defined Benefit

A

appd

Registered User
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Hi

I have a Defined Benefit penion plan (currently) with my employer. I also contribute a small amount in avc's which seems to be managed in a seperate defined contribution plan.

I am 37 which I believe entitles me to contribute up to 20% of salary while receiving tax relief.

I have some savings that rather than leave on deposit, I could funnell into my avc plan, by making payroll deductions and using the savings to cover living expense shortfalls.

We are required to contribute 10% of salary to the DB plan.

My gross salary is 67K. My pensionable salary according to the statements is 59K. So 10% of that is 5900 per year into the DB funds.

Does that mean that 20% of 67K = 13400.

13,400 minus 5900 = 7500.

Does this mean that I can top up my AVC plan by 7500 per year?

thanks
 
Appd

that looks spot on. Remember you can make the contribution against 2012 earnings up to October 2013 and revenue will send you a refund for 2012.

So if making an AVC make sure you max out 2012 relief 1st

Cheers
 
I am in a similar position. However, my defined benefit pension is non contributory, i.e. my employer funds the pension in full up to 40/60 final salary including state pension on retirement with full service.
I also pay AVCs, currently 6% and my employer pays 2%. I am paying AVCs to avail of my employers 2% AVC top up, the tax relief, my employer may buy out or end the defined benefit pension at some stage in the future, I will have moved on or it will be underfunded at some point in the future (hopefully not). Because I don't contribute to the defined benefit, can I avail of the age related AVC contribution limits?
 
Hi Pugwall

Yes you can top up your AVCs to the age related limits. As long as your contributions Employee (EE) and AVC dont breach these limits you are fine. Your DB scheme is 100% Employer (ER) funded.
 
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