01 Sep 2019, 15:53
As far as i am aware you used to be able to take the first £30K tax free and place the remaining amount into an AVC if you were to be offered a VR deal (normally 2 year deal) .Since Zurich /Scottish widows are now running the AVC , i believe it is no longer possible to add a lump sum into your account at the end of the tax year ( only way to increase is by weekly)
Can anyone clarify if a VR deal were to be offered can you still place the remaining amount ( above 30k) into an AVC ?
Thanks in advance
01 Sep 2019, 17:15
It said in the AVC booklet we got a few months back, that it would no longer be possible to put in a lump sum into our AVC's by cheque. However it does say that we can still make one-off payments, which have to be via payroll. They are limited to how much you earn during that pay period. See page 7.
So assuming things are set up properly, it should in theory at least, be possible to pay in the taxable element of a VR payment into your Flexiplan the week you receive payment.
But I would contact the PSC for clarification.
If you can't pay the taxed amount into your AVC, then you can still pay it into a personal pension and get tax relief on it, meaning you get the tax back and the whole VR sum would effectively be tax free. Although you obviously need to withdraw it from the pension without paying tax, to get the full benefit.
01 Sep 2019, 20:33
As usual , many thanks Robert
11 Sep 2019, 10:23
Or - if you are not going to work in this financial year. Claim the tax back. I did. You need parts 2 & 3 of your P45. Send them off to the IR more than 35 days after taking VR. Providing you do not plan to work before the next financial year. I got my tax paid back from payment above 30K.
If you want more info PM I'll go through it with you.