29 Sep 2019, 16:16
What happens when taking these early?
29 Sep 2019, 16:39
The normal use for AVC's(Bonusplan & Flexiplan) is to fund the tax free lump sum when you take your main NRA60 & NRA65 benefits. That would still be the case if you take your main benefits early.
Your AVC's aren't reduced in any way – they'll be worth whatever they're worth at the time!
But if you've paid 'added years AVC's' in the past, those benefits would be reduced if taken early.
You could use your AVC's to purchase an annuity(income for life) instead of a tax free lump sum, or a mixture of both. But generally the younger buy an annuity, the less income you'll get.
Alternatively you also have the choice to transfer your AVC cash out to a separate DC scheme at any point and take your cash independently of your main benefits. But when you subsequently access it(age 55+), only 25% would be guaranteed to be tax free, with the rest being classed as income.