ANNOUNCEMENT : ROYAL MAIL EMPLOYMENT POLICIES (AGREEMENTS) AT A GLANCE (UPDATED 2017)... HERE


Maximum PSE Payments

10 Aug 2017, 20:52

Sorry, I can't find the topic but I know it been discussed.

What is the maximum weekly amount you can pay into an AVC without losing out on PSE contribution.

Thanks


Maximum PSE Payments

10 Aug 2017, 22:08

Currently £7.20 x the number of contracted hours. Do NOT include any shift or job specific allowances in your calculation. I made the mistake of increasing my payment over this. It meant I dropped out of PSE, which cost me extra by way of NI contributions. I am full time, so 39 hours. I currently pay £116 pw to Flexi plan, plus £2.88 fixed to Bonus plan. This latter payment would stop under Rms proposals for removing the LEL. I'm section C member of the pension plan. Under their new scheme, my pension contribution would increase to fall in line with section B members. It is unclear whether future AVCs would go to the NRA60 plan, as they do now, or if they would go to the NRA65 plan. Hope that helps.

Maximum PSE Payments

10 Aug 2017, 22:29

Thank you.

Maximum PSE Payments

11 Aug 2017, 06:31

heapsy wrote:This latter payment would stop under Rms proposals for removing the LEL. I'm section C member of the pension plan. Under their new scheme, my pension contribution would increase to fall in line with section B members.

That was the original proposal!

The latest is a dual Cash Balance / DC scheme that section C members would still have the LEL/LED taken off their earnings to make up their pensionable pay. Details: https://www.myroyalmail.com/pensions/rm-pension-plan

Whether that means a reprieve for Bonusplan is unknown!

It is unclear whether future AVCs would go to the NRA60 plan, as they do now, or if they would go to the NRA65 plan. Hope that helps.

The usual use of AVC’s is to fund the tax free lump sum, and they can be accessed when taking either NRA60 or NRA65. You could take your Flexiplan with your NRA60 & your Bonusplan with your NRA65, for example.

Plus, under pension flexibility rules, you can access your AVC’s anytime after 55 independently of your main RMPP benefits if you choose. But you’re far more likely to be hit with a big tax bill.

What is unclear is whether the ‘Cash Balance’ would:
1. Have an NRA at all.
2. Whether there would be reductions for taking it before any NRA.
3. Whether any AVC’s would be able to be made into it.

I think it’s reasonable to assume the DC option would be on a par with any other DC scheme and so additional contributions would be allowed up to a total of 100% of pay. And that it would be accessible from 55, completely separately from the main RMPP benefits.

Maximum PSE Payments

11 Aug 2017, 15:57

I spent a few months doing the Hokey Cokey on this one with Sheffield. I believe the £7.20 figure has been revised upwards. I'm in London and pay £220 p/w into an AVC which I think is right on the limit for maximising tax and N.I returns. Don't ring Sheffield for advice, they're useless!

Maximum PSE Payments

11 Aug 2017, 16:38

foxyjarvis wrote:I spent a few months doing the Hokey Cokey on this one with Sheffield. I believe the £7.20 figure has been revised upwards. I'm in London and pay £220 p/w into an AVC which I think is right on the limit for maximising tax and N.I returns. Don't ring Sheffield for advice, they're useless!


I was wondering what the limit was myself - i am full time 39 hours and paying £100pw into flexiplan...will be increasing that in the near future.

I agree about Sheffield - i have sent them a couple of emails asking a simple question...all i got was a rather cold condescending reply and "do it yourself" answer.

Totally useless

Maximum PSE Payments

11 Aug 2017, 20:08

RobertT wrote:
heapsy wrote:This latter payment would stop under Rms proposals for removing the LEL. I'm section C member of the pension plan. Under their new scheme, my pension contribution would increase to fall in line with section B members.

That was the original proposal!

The latest is a dual Cash Balance / DC scheme that section C members would still have the LEL/LED taken off their earnings to make up their pensionable pay. Details: https://www.myroyalmail.com/pensions/rm-pension-plan

Whether that means a reprieve for Bonusplan is unknown!

It is unclear whether future AVCs would go to the NRA60 plan, as they do now, or if they would go to the NRA65 plan. Hope that helps.

The usual use of AVC’s is to fund the tax free lump sum, and they can be accessed when taking either NRA60 or NRA65. You could take your Flexiplan with your NRA60 & your Bonusplan with your NRA65, for example.

Plus, under pension flexibility rules, you can access your AVC’s anytime after 55 independently of your main RMPP benefits if you choose. But you’re far more likely to be hit with a big tax bill.

What is unclear is whether the ‘Cash Balance’ would:
1. Have an NRA at all.
2. Whether there would be reductions for taking it before any NRA.
3. Whether any AVC’s would be able to be made into it.

I think it’s reasonable to assume the DC option would be on a par with any other DC scheme and so additional contributions would be allowed up to a total of 100% of pay. And that it would be accessible from 55, completely separately from the main RMPP benefits.


As yet, it is the only proposal we do have. There is no point in giving any other information as not other proposal has been put forward regarding this particular matter.

Maximum PSE Payments

11 Aug 2017, 20:13

dandydon wrote:
foxyjarvis wrote:I spent a few months doing the Hokey Cokey on this one with Sheffield. I believe the £7.20 figure has been revised upwards. I'm in London and pay £220 p/w into an AVC which I think is right on the limit for maximising tax and N.I returns. Don't ring Sheffield for advice, they're useless!


I was wondering what the limit was myself - i am full time 39 hours and paying £100pw into flexiplan...will be increasing that in the near future.

I agree about Sheffield - i have sent them a couple of emails asking a simple question...all i got was a rather cold condescending reply and "do it yourself" answer.

Totally useless


Are you sure you are still within PSE limits? I was paying a total of £132.88, but kept dropping out of PSE, which meant getting hammered on NI payments. I dropped the payments to current levels to avoid this.

Maximum PSE Payments

12 Aug 2017, 02:23

heapsy wrote:As yet, it is the only proposal we do have. There is no point in giving any other information as not other proposal has been put forward regarding this particular matter.

Heapsy: I realise I went off topic a bit from the initial PSE question, but it was you who posted incorrect/out of date information!

RM’s original proposal was a DC scheme with them contributing 10% of pay and with the Lower Earnings Deduction being done away with for Section C members.

That has now been superseded by their newer proposal of a choice between a Cash Balance and a DC scheme with RM contributing 13.6%, but with the LED still in place for those in Section C.

I provided a link, I suggest you read it.

Maximum PSE Payments

12 Aug 2017, 13:55

RobertT wrote:
heapsy wrote:As yet, it is the only proposal we do have. There is no point in giving any other information as not other proposal has been put forward regarding this particular matter.

Heapsy: I realise I went off topic a bit from the initial PSE question, but it was you who posted incorrect/out of date information!

RM’s original proposal was a DC scheme with them contributing 10% of pay and with the Lower Earnings Deduction being done away with for Section C members.

That has now been superseded by their newer proposal of a choice between a Cash Balance and a DC scheme with RM contributing 13.6%, but with the LED still in place for those in Section C.

I provided a link, I suggest you read it.


The thread is regarding AVCs. Not the pension proposal. If you had read it, you would have known. My answer was regarding the AVCs, which, as I explained, we do not have a clear understanding of at this moment in time. It has nothing to do with the pension itself.

Maximum PSE Payments

13 Aug 2017, 05:39

heapsy wrote:The thread is regarding AVCs. Not the pension proposal. If you had read it, you would have known. My answer was regarding the AVCs, which, as I explained, we do not have a clear understanding of at this moment in time. It has nothing to do with the pension itself.

It was you who mentioned the proposals! Where you said:
heapsy wrote:This latter payment would stop under Rms proposals for removing the LEL. I'm section C member of the pension plan. Under their new scheme, my pension contribution would increase to fall in line with section B members. It is unclear whether future AVCs would go to the NRA60 plan, as they do now, or if they would go to the NRA65 plan. Hope that helps.


I pointed out that RM have come up with new proposals which means the LED would still be in place for section C members. I was worried the Hawkey99(the OP) or any other interested parties would be confused by your incorrect answer.
I also pointed out that AVC’s do not have an NRA other than the legal minimum age for accessing any pension, which is currently 55.

Pensions can be complex and many people don’t understand them too well. So I try and make sure users of these forums are informed as much as possible and point them in the right direction of any further reading that may help them, including you on several occasions.
Or would you prefer people are given the incorrect information?

Yes I then went off topic somewhat! Naughty naughty me! :cuppa

Q. Is that against board rules?
A. Based on the number of times it happens, no.

Q. Are you a moderator of these boards?
A. No.

Q. Have I been reprimanded by the moderators of these boards for my extremely bad behaviour?
A. No.

Q. Is it time you moved on?
A. Yes.

Maximum PSE Payments

13 Aug 2017, 08:08

Yes, I understand your point completely regarding the LEL. However, as it has been said before, clarity regarding the issue of which part of your pension your AVCs can go into was my main point, as you know , there is still a little uncertainty.
Last edited by heapsy on 13 Aug 2017, 14:22, edited 1 time in total.

Maximum PSE Payments

13 Aug 2017, 10:48

Guys,

You are 2 great posters and highly valued on the board.

Surely its better to get back on subject than "he said she said"

I for one really value these boards and would hate for either of you to stop posting.

So onto the reason for my post.

Do you think that given Royal Mail have now given us their 2 schemes (which might change in amounts paid in but I dont seem then changing much) do you think that our AVCs are likely to stay ??

Thanks

Maximum PSE Payments

13 Aug 2017, 14:55

Hawkey99 wrote:Guys,

You are 2 great posters and highly valued on the board.

Surely its better to get back on subject than "he said she said"

I for one really value these boards and would hate for either of you to stop posting.

So onto the reason for my post.

Do you think that given Royal Mail have now given us their 2 schemes (which might change in amounts paid in but I dont seem then changing much) do you think that our AVCs are likely to stay ??

Thanks


Only this week I received a communication from RM regarding the funds. This tells me they WILL continue. I started paying AVCs very late, so hopefully I'm right. However, I'm also paying in to a stocks and shares ISa. Pros and cons with them both, but should have enough cash on top of the actual pension I eventually draw it.

Maximum PSE Payments

13 Aug 2017, 15:28

Heapsy,

Can you share a bit more about what they said regarding AVCs.

Great news. Im surprised they haven't put it out in a document yet.

Thanks

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