AVC and my age can I increase my current AVC

[thewire2020]

Hi ,

I’m currently paying 16% AVC
employer 7% and I match with 7%
total 30%

However can I change this to AVC at 23% along with my 7% match , I’m 52 this month?
30% from me total
7% employer

Thank you

 

[AndroidMan]

Limits here:

Tax relief for pension contributions

This page outlines the tax relief for pension contributions

www.revenue.ie

At 52, you can have 30% AVC

 

[Protocol]

The 30% refers to all employee pension contrs, not just the AVC component.

 

[Gordon Gekko]

Hi ,

I’m currently paying 16% AVC
employer 7% and I match with 7%
total 30%

However can I change this to AVC at 23% along with my 7% match , I’m 52 this month?
30% from me total
7% employer

Thank you

Yes, you can.

The 7% ‘match’ and the 23% AVC bring you to the 30% for a soon-to-be 52 year old.

 

[fayf]

There are a few other options here also

For 2023, you have had nearly 5 months, where you were only putting in a combined 23%, so there is scope for you to pay in more than 23% for the remainder of this year(subject to an annual max at 30%), and get tax relief via payroll.

In January 2024, You could then change this to a combined 30%.

This can also be done post 2023 tax year end via, A lump sum avc payment to the pension provider, you then claim 40 % tax relief, post 2023 tax year end, but before the deadline of October 31st 2024.

For 2022, you can also make
An additional AVC Lump sum amount up to your limit,
as you did not contribute the max age related amount in 2022, this can be an option, and is done via your pension provider,(sometimes via payroll)
The 2022 one off avc payment would also need to be done before the October 31st deadline, 2023, in order to 2022 claim tax relief.

 

[ClubMan]

Limits here:

Tax relief for pension contributions

This page outlines the tax relief for pension contributions

www.revenue.ie

At 52, you can have 30% AVC

Not directly relevant here but, just to note that in the year that you hit the next pension tax relief age you can contribute the relevant percentage tax free for the full year. So, even if you turn, say, 50 on December 31st you can contribute 30% for that full year and not just the next.

 

[fayf]

Not directly relevant here but, just to note that in the year that you hit the next pension tax relief age you can contribute the relevant percentage tax free for the full year. So, even if you turn, say, 50 on December 31st you can contribute 30% for that full year and not just the next.

It is somewhat relevant here as OP had the option of paying an additional AVC in 2021, to may out the 30%, but the deadline for doing that was October 31 st 2022.

 

[Harfang]

Not directly relevant here but, just to note that in the year that you hit the next pension tax relief age you can contribute the relevant percentage tax free for the full year. So, even if you turn, say, 50 on December 31st you can contribute 30% for that full year and not just the next.

Thanks to folks on here , perhaps you Clubman, this was brought to my attention and I acted upon it. 50 in November.

 

[ctlsleh]

I turn 55 this year, am I still limited to 30% ceiling of the 115K or because I will be 55 in the current year, I can increase my ceiling to 35% ……?

 

[ClubMan]

I turn 55 this year, am I still limited to 30% ceiling of the 115K or because I will be 55 in the current year, I can increase my ceiling to 35% ……?

The latter - even if somebody turned 55 on December 31st they are eligible for the 35% tax relief amount for the full year.
It was @LDFerguson who apprised me of this years go.

 

[ctlsleh]

Thank you