Decision on making AVCs

[Nermal]

Hi, am in a job with a relatively decent DB scheme, and am only 25 so have the prospect of the full 2/3 salary on retirement if I stayed there (depressing thought frankly).

At the moment I'm making the maximum AVC contribution. If I leave before retirement, obviously it may be to a job without such a good scheme, and my contributions may come in handy. But let's imagine I don't?

The maximum pension receivable, if I understand the rules correctly, is 2/3 final salary plus a 20% lump sum. So if my AVCs bought me more than this, I couldn't access it? If your pension is funded higher than this level, are you effectively just giving your contributions away?

 

[asdfg]

The maximum pension allowed by revenue is 2/3 of final salary per P60 which includes BIK overtime etc. This includes a lump sum payment which is 1.5 times annual P60 figure.
The max allowed by your company scheme is propably 2/3 of your salary less state pension after 40 years service.
The difference can be made up of AVC's which you are doing. Any amount you contribute which increases your pension fund "company and AVC's" to an amount greater than 2/3 allowed by revenue means that your company scheme contributes less so it is important that you know when you are near the expected maximum pension.

 

[sunshine?]

Are you sure thats correct re your p60. Not sure but thought your P60 only shows your taxable income. Contributions to an AVC are not taxable, so I'm guessing they would not show as income on your p60.

So if in the last year your decided to contribute 30% to your AVC, would your P60 be down 30%, hense your pension and lumpsum revenue max. Doesn't seem to add up.