AVC query

[July 1981]

Today I have received Flexible access statement, this explains that as I have accessed part of my pension through UFPLS I have a limit of 10K I can receive pension tax relief on each year, I only have an AVC and the new Collective plan pension so gave them a ring for confirmation that this pension is included as I wasn’t sure if it was DC or DB, the chap went and checked and rang back five minutes later to confirm that the pension falls under 10k rule, sorry a bit long winded, I will need to reduce my AVC by £20 per week, is it possible to pay direct and to for go the tax relief?

[RobertT]

Once you've triggered the Money Purchase Annual Allowance, you can then only pay a maximum of £10k per year into DC pensions and get tax relief. That includes any pensions you have via your employer or have set up yourself. It also includes employer contributions.

More info: https://www.moneyhelper.org.uk/en/pensi ... wance-mpaa

As a matter of interest, did they say the whole RMCPP is classed as DC or just the pension element and AVC's?

[July 1981]

The guy I spoke to went away for advice and he said it all came under the 10k limit, it’s not a DB pension but in my opinion it’s not a DC either, I’m erring on side of caution, can I pay into the AVC without tax relief?

[Jaggs]

The guy I spoke to went away for advice and he said it all came under the 10k limit, it’s not a DB pension but in my opinion it’s not a DC either, I’m erring on side of caution, can I pay into the AVC without tax relief?

I hope you don't mind me suggesting this but in my view it is best to ask questions like this of the pension schemes via email. That way you have any response in writing and if it turns out what they've told you is incorrect you would be able to prove it far more easily.

[RobertT]

The guy I spoke to went away for advice and he said it all came under the 10k limit, it’s not a DB pension but in my opinion it’s not a DC either,

The lump sum element(inc booster) is called the 'Defined Benefit Lump Sum', hence my question.

The pension element falls somewhere between DC and DB, but technically is a DC/money purchase scheme.

AVC's are DC.

I’m erring on side of caution, can I pay into the AVC without tax relief?

If you pay in more than £10k, the amount over will be added to your taxable income and taxed accordingly.

[July 1981]

The guy I spoke to went away for advice and he said it all came under the 10k limit, it’s not a DB pension but in my opinion it’s not a DC either, I’m erring on side of caution, can I pay into the AVC without tax relief?

I hope you don't mind me suggesting this but in my view it is best to ask questions like this of the pension schemes via email. That way you have any response in writing and if it turns out what they've told you is incorrect you would be able to prove it far more easily.

Fair point, thanks for the advice

[July 1981]

Jaggs and Robert, I have emailed the Collective plan and let you know the reply, thanks for your assistance.