When can I take my AVC benefits?

Discussion in 'Pensions' started by nad, Feb 7, 2007.

  1. nad

    nad Frequent Poster

    Posts:
    205
    Is it possible to recieve my avc contributions before 65, e.g. if iretired at 60,and who makes the decision,is it my employer or my avc management company?
     
  2. jpd

    jpd Frequent Poster

    Posts:
    1,166
    Re: avc,s

    Normally, your AVC benefits are taken at the same time as your pension scheme benefits ie when you retire. If you retire before the normal retirement age as defined in the scheme rules, then yes you would normally be able to take your AVC benefits. However, you need to check with your pension scheme administrators
     
  3. Guest126

    Guest126 Guest

    Re: avc,s

    It is compulsory, rather than normally.

    The AVC benefit must be taken at same time as main scheme benefit.
     
  4. ajapale

    ajapale Moderator

    Posts:
    7,671
    Re: avc,s

    So if the occupational pension scheme provides for early retirement or retirement through ill health then the associated AVC benefits can drawn as well at the same time?
     
  5. Guest126

    Guest126 Guest

    It's complulsory - AVC benefit is a "part" of the main plan benefit.
     
  6. Guest127

    Guest127 Guest

    I have a relatively small avc. I retired in December and phoned Eagle Star to enquire about what happens next. ( I want to convert it to an arf and just leave it there) Eagle Star said that my employer is the one who should inform them and they would take it from there. that was 2 months ago. Should I do something as I feel my previous employer hasn't a bull's notion of this avc, which was not deducted in the normal manner but was one lump sum payment within the limits. the tax authories made the refund straight after I sent them a receipt from eagle star. (I don't really want to draw down any of the arf but apparantly I should drawn down 5% or something like that as I am going to be taxed on a deemed withdrawal anyway.)
    Just thinking. if you are taxed on a 'deemed' withdrawal for say 10 years on the trot - say from 2007 to 2016 af 5% per annum. could you drawn down 50% tax free in 2016 as you had already paid tax on it?
     
  7. Guest126

    Guest126 Guest

    Draw it down.

    Speak to your employer, fast.

    Find out from ES what they want from your employer (in writing).

    To answer your last question - No.
     
  8. Guest127

    Guest127 Guest

    CapitalCCC: thanks for reply. will get on to employer straight away. don't really want to draw it down as that will negate any benefit gained from tax refund in first place ie if I draw if down now I will be (probably) be liable to tax at 41% as a) I have a reasonable pension and b) I am currently back at work with a different emloyer and c) I was hoping to leave it alone for a future rainy day. I know that any interest earned on the arf is tax free so the more interest the arf earns the better.
    I will see what my former employer has to say and come back here later. cheers and thanks
     
  9. Guest126

    Guest126 Guest

    You're welcome Cuch.

    A deeemed withdrawal of 1% will be taxed anyway, this will rise to 2% and then 3% over the next couple of years.

    That is why I recommend that you withdraw at least this deemed amount.

    The ARF does grow tax free - even if you draw down the 1%/2%/3% with any fund growth your fund size should not be diminished by these small withdrawals.

    You may want to use your AVC fund to provide for your tax-free lump-sum if it is not too late to do so.
     
  10. Guest127

    Guest127 Guest

    CapitalCCC: employer has just responed that its up the me to contact Eagle Star and get the arf sorted. got a tax free lump sump on leaving so I doubt I will have any tax free lump sum allowance left. will find out from ES. ( usual tax free terms 1.5 times annual salary, + 25 weeks early retirement payment - this could have been up to 27 weeks but my age determined the number of weeks ) thanks for advice
     
  11. Guest126

    Guest126 Guest

    No problem cuch - I hope you have a nice enjoyable retirement!
     
  12. Guest127

    Guest127 Guest

    thanks Capital: trouble was that after 40 odds years I couldn't do nothing. so I asked around and (should have hit myself over the head with a wooden plank) found a 28 hour job. really really don't want these hours so must keep looking for something less. but in the meantime.......cheers and thanks.
     
  13. Guest127

    Guest127 Guest

    just in case anyone is interested. the 'deemed' withdrawal on a arf doesn't have to take place until you are 60. over 60 in fact as it doesn't come into play until you are 60 (or older) for the whole year. its 1% this year, 2% in 2008 and 3% in each subsequent year.
     
  14. bigred

    bigred Frequent Poster

    Posts:
    57
    To get around having to wait until the main plan benefit to also take my AVC benefit e.g. 65 in my case could I set up a PRSA outside my occupational scheme to house my AVC's and take the benefit at 60?
     
  15. Guest126

    Guest126 Guest

    No.

    As name suggests, AVC benefits are in addition to (and linked to) main plan benefits.
     
  16. bigred

    bigred Frequent Poster

    Posts:
    57
    but if I wanted to I can elect not to make any AVC's to my main / company plan and seperatly use up my AVC allowance for a PRSA which I can take at 60?
     
  17. Guest126

    Guest126 Guest

    No - it is still governed by the Trust Deed and Rules of the main plan (hence the name AVC!).
     
  18. bigred

    bigred Frequent Poster

    Posts:
    57
    thanks for the feedback CCC.. sorry I'm struggling to understand this but I think I have it now!.. Is it because when opening a standalone PRSA - AVC i must disclose information on my main pension scheme? in this way I can see how the two could be linked. If this is the case I guess the fact I am already a member of the work scheme means I am not eligible to open a plain old standard PRSA and not refer to the fact I have a work scheme already in place!?
     
  19. Guest126

    Guest126 Guest

    Exactly - and no, you can't (shouldn't!) do that!