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Withdrawing your AVC pension It's possible to cash in an AVC pension at the age of 55 (57 from 2028), no matter if you're still working or intend to retire.
An Additional Voluntary Contribution (AVC) pension is a way to make additional flexible contributions to your workplace pension. You'll enjoy government tax relief on anything you put in, up to your annual allowance, and may also get other perks such as lifetime income from your contributions.
Your AVC plan is an investment and the value can go down as well as up. You may not get back what you put in. You can choose which investment route you prefer. You can usually take up to 25% of the value of your FSAVC fund as a tax- free lump sum.
You can take some or all of your AVC fund as a tax-free cash lump-sum , but you can only take it all as a lump-sum if you draw it at the same time as your main LGPS benefits and provided, when added to your LGPS lump-sum, it does not exceed 25% of the overall value of your LGPS benefits (including your AVC fund).
You can access a DC AVC pension from the age of 55, regardless of whether you're still working or not. You can of course leave it invested to continue growing.
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The maximum you can pay in AVCs to the Fund is 15 per cent of gross earnings less your standard Pension Fund contributions. If you are considering maximising your AVCs before the tax year end you need to make sure you allow enough time for your request to be processed.
The maximum earnings limit for tax relief on pension contributions for 2022 is \u20ac115,000. So in the years before your retirement if you are aged 55 to 59 you can contribute 35% of your salary into your pension scheme for tax relief purposes. This percentage increases to 40% from age 60.
Advantages of AVC pensions It could be cheaper than taking out an entirely separate personal pension. You have the flexibility to stop, start and amend contribution amounts when you want. Pension tax relief on qualifying contributions will boost your pension further.
The AVC provider is often an insurance company or building society. You have your own personal account and you decide how the money in your pot is invested. You can pay AVCs if you are in the main or 50/50 section of the LGPS. You can pay up to 100% of your pensionable pay into an in-house AVC.
This flexibility is one of the best benefits of investing in an AVC. In the long run, investing in an AVC is one of the best decisions you can make during your employment. Your AVC will stand to benefit you by providing you with tax savings as well as giving you extra savings when you retire.

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