To be clear:
- the Revenue maximum retirement lump sum from a DB scheme is 150% of Final Salary (which can include fluctuating earnings) subject to having at least 20 years service by retirement
- if the above figure were to exceed €200k, then the first €200k is tax free and any excess up to €500k is taxable at 20%
- if you have an AVC fund in addition to the DB benefits, the AVC is deemed as part of the main scheme. So it is NOT the case that you can take a lump sum of 150% + 25% of the AVC fund. The overall lump sum is limited to 150% of Final Salary (so €90k as quoted originally).
- if you take the €90k from the AVC pot, then the DB Pension will not be reduced. Any excess from the AVC pot can then be invested into an ARF (from which a minimum of 4% pa must be drawn down as income and potentially taxed) OR the residual AVC pot can be drawn down entirely, but will be taxed as income in that year.