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DC pension and avc's

22 Jan 2020, 22:30

If I start paying avc's on top of my current pension payments do I get tax relief as I do with my dc payments?

DC pension and avc's

23 Jan 2020, 00:27

Yes. And you also get PSE up to certain limits.

DC pension and avc's

23 Jan 2020, 10:29

thank you. done a bit more research into it and I`m going to pull out of the partnership/matching share scheme and up my pension contributions to match the 10% RM put in.

DC pension and avc's

23 Jan 2020, 17:43

ihatedogs wrote:thank you. done a bit more research into it and I`m going to pull out of the partnership/matching share scheme and up my pension contributions to match the 10% RM put in.
how do you sign up to Avcs?

DC pension and avc's

23 Jan 2020, 18:08

Dindin wrote:
ihatedogs wrote:thank you. done a bit more research into it and I`m going to pull out of the partnership/matching share scheme and up my pension contributions to match the 10% RM put in.
how do you sign up to Avcs?


https://www.scottishwidows.co.uk/save/royalmaildcplan/

That's the website for the DC pension mate, you can mess about with calculations on there to see how increasing your contributions will affect your pension.
08000928263 is the DC plan phone number where they will take instructions over the phone.

DC pension and avc's

23 Jan 2020, 18:37

And if you're in the RMPP and currently paying into the DBCBS, the website to look at is:
https://www.royalmailpensionplan.co.uk/ ... n-benefits

DC pension and avc's

23 Jan 2020, 20:00

ihatedogs wrote:
Dindin wrote:
ihatedogs wrote:thank you. done a bit more research into it and I`m going to pull out of the partnership/matching share scheme and up my pension contributions to match the 10% RM put in.
how do you sign up to Avcs?
thanks dogs

https://www.scottishwidows.co.uk/save/royalmaildcplan/

That's the website for the DC pension mate, you can mess about with calculations on there to see how increasing your contributions will affect your pension.
08000928263 is the DC plan phone number where they will take instructions over the phone.

DC pension and avc's

23 Jan 2020, 20:01

RobertT wrote:And if you're in the RMPP and currently paying into the DBCBS, the website to look at is: thanks Robert T
https://www.royalmailpensionplan.co.uk/ ... n-benefits

DC pension and avc's

23 Jan 2020, 20:02

RobertT wrote:And if you're in the RMPP and currently paying into the DBCBS, the website to look at is:
https://www.royalmailpensionplan.co.uk/ ... n-benefits

Thanks Robert T

DC pension and avc's

24 Jan 2020, 10:58

RobertT wrote:And if you're in the RMPP and currently paying into the DBCBS, the website to look at is:
https://www.royalmailpensionplan.co.uk/ ... n-benefits


Thanks Robert.
Quick question - I am due to receive my NRA60 pension in March (if Capita get their finger out) but carrying on working and so was thinking about starting a flexiplan AVC to build up my 65 pension lump sum. I am assuming that doing this will attract PSE and therefore tax relief? Not looking forward to paying basic rate tax on the monthly pension payments but was hoping that by doing this it will soften the blow a little. Thanks.

DC pension and avc's

24 Jan 2020, 15:17

Steve_claret wrote:
RobertT wrote:And if you're in the RMPP and currently paying into the DBCBS, the website to look at is:
https://www.royalmailpensionplan.co.uk/ ... n-benefits


Thanks Robert.
Quick question - I am due to receive my NRA60 pension in March (if Capita get their finger out) but carrying on working and so was thinking about starting a flexiplan AVC to build up my 65 pension lump sum. I am assuming that doing this will attract PSE and therefore tax relief? Not looking forward to paying basic rate tax on the monthly pension payments but was hoping that by doing this it will soften the blow a little. Thanks.

You get tax relief on all pension payments, which means that each £1 gross only actually costs you £0.80. But RM employees also have the benefit of salary sacrifice(PSE), which is effectively National Insurance relief. Meaning another £0.12 per £1 is paid by the government instead of you.

So in total each £1 only actually costs you £0.68, and your money is increasing by 47% before any interest or investment growth is added on. You'd be a fool to not take advantage!

If you're in section C then I'd pay into Bonusplan to get an additional contribution from RM aswell as Flexiplan. It all adds up!

Your plan is a good one! You might be paying tax with one hand but you'll be getting some back with the other. :thumbup

DC pension and avc's

24 Jan 2020, 16:44

Thanks again Robert.
I'm section B so I believe only Flexiplan is open to me.
I need to ring the PSE people and check how much I can pay in without falling out of PSE.

DC pension and avc's

24 Jan 2020, 17:19

I'm not sure whether they'll give you that sort of advice or not, but there is an easy way of working out the maximum to stay within PSE limits:

Basic RM hourly pay – hourly minimum wage x hours worked.

So for a full timer, that would look something like:

11.62 – 8.21 = 3.41 x 38 = 129.58

That's the gross amount, so your take home pay would only reduce by about £88. Although personally I wouldn't go above around £120(gross) / £81(net) to be on the safe side.

DC pension and avc's

25 Jan 2020, 11:52

The minimum wage will change to £8.72 on the 1st April, so worth checking if your quite close to the maximum within pse

DC pension and avc's

25 Jan 2020, 12:55

Good advice as usual. Thanks guys.

DC pension and avc's

31 Jan 2020, 18:05

RobertT wrote:I'm not sure whether they'll give you that sort of advice or not, but there is an easy way of working out the maximum to stay within PSE limits:

Basic RM hourly pay – hourly minimum wage x hours worked.

So for a full timer, that would look something like:

11.62 – 8.21 = 3.41 x 38 = 129.58

That's the gross amount, so your take home pay would only reduce by about £88. Although personally I wouldn't go above around £120(gross) / £81(net) to be on the safe side.



RobertT,

Just wanting to check with you that this advice of remaining within PSE linits relates to the entire pension payment that I make? As in 6% from salary as normal maximum contribution and then the balance made up to the level from AVCs?

Thank you in anticipation of your reply.

DC pension and avc's

31 Jan 2020, 19:18

I have no personal experience of paying the maximum into AVC's, but there are people on these forums that currently pay in the region of £120(gross) / £82(net) per week in AVC's on top of their basic contribution.

I'm sure someone will come along and confirm.

But bear in mind the comment from mrcurve about the minimum wage increasing in April. Assuming we don't get a pay rise, and using the same maths as above, that will reduce the maximum amount to about £110(gross) / £75(net).

DC pension and avc's

31 Jan 2020, 22:12

I'm currently paying £120.88, just short of the maximum permitted. This gives me an hourly rate of £8.43. About 22p above the minimum wage rate.

DC pension and avc's

01 Feb 2020, 06:28

Thank you ever so much for your help.

Looking to maximise pension income so will max out contributions as long as I can afford to. :thumbup

DC pension and avc's

01 Feb 2020, 16:34

heapsy wrote:I'm currently paying £120.88, just short of the maximum permitted. This gives me an hourly rate of £8.43. About 22p above the minimum wage rate.


Heapsy, is that £120.88 all towards your AVC or are you still contributing to your regular pension scheme so is a total to both?

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