Max AVCs from Redundancy payment

K

Kandy

Guest
I’am about to be made redundant on the 31/01/07 (this is actually quite opportune for me as I have secured alternative employment already, so it’s not as a bad a start to the new year as it may appear). My redundancy payment will consist of 30K statutory + 110K ex. gratia payment from the company . I wish to maximise the amount that I can put into my AVC plan from the ex. gratia element of the payment. I have been paying AVCs at 10% of salary since 2004. I also have been contributing 5.5% of salary to the defined benefit company scheme for the past 20 years . The max contribution currently allowed by revenue for my age bracket is 25%.
My questions are :

1. How far back can I backdate AVC contributions for revenue purposes, to utilise the max 25% of salary contribution ?

2. Is it possible for the company to pay the 110K (non statutory) element directly into my AVC fund in this situation ?

3. Are ther other options I should consider ?

Many thanks & a Happy New Year,

Kandy
 
Well spotted - I had clean forgotten that things had changed.

For (what I think is) the current position.....I can't post a link so do the following:

  • Go to revenue.ie.
  • Enter keyword search "backdate AVC contribution".
  • You'll get one result - a statement of current practice.
  • Go to the end of page 242 and following.
 
Hi,

Many thanks for the detailed replies.

Read the Revenue article advised by Oysterman, “spread back” relief does not lok like an option for me , but I think “spread forward” relief could be – how would this work in my situation ? Can I proceed as planned and make the lump sum contribution to my AVC fund in January 07 and abstain from making any further AVC contributions over the coming years until the accumulated annual 25% of salary pension contribution allowances have covered the lump sum contribution made in Jan 07 or do I pay tax now up front on the excess on the excess and reclaim the tax allowance on an annual basis going forward ?

Is it allowed by Revenue for the company to pay the ex. gratia element of my redundancy directly into my AVC fund without tax implications / consequences ?

Many thanks for your help.

Kandy
 
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