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NRA 60 & AVC
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Streets4228
- Posts: 17
- Joined: 10 May 2021, 13:35
- Gender: Male
NRA 60 & AVC
Please can you help me here. I'm coming upto 55 in a couple of months. I have been paying I to the flexiplan and bonus plan for about 21 years and have built up a sizeable sum of money. Now the question is can I take my AVC's and keep paying my pension payments I to the RMP or do I have to take both at the same time?
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RobertT
- EX ROYAL MAIL
- Posts: 6644
- Joined: 09 Sep 2007, 14:26
- Gender: Male
Re: NRA 60 & AVC
The usual use for AVC's(Bonusplan & Flexiplan) is to fund the tax free lump sum when taking your NRA60/65 benefits.
You can take your AVC's separately from your main benefits if you want to, either before or after you take your NRA60/65. But they would need to be transferred into a personal pension first.
The problem with doing that is that only the first 25% is then guaranteed to be tax free with the remainder coming under normal PAYE income tax rules.
You can't just take out the balance of your AVC's just because you're aged 55+. They're pensions, so pension rules apply to them.
For most people it's best to take AVC's with main NRA60/65 benefits, as that's likely to be the most tax efficient. Although there's always exceptions.
You can take your AVC's separately from your main benefits if you want to, either before or after you take your NRA60/65. But they would need to be transferred into a personal pension first.
The problem with doing that is that only the first 25% is then guaranteed to be tax free with the remainder coming under normal PAYE income tax rules.
You can't just take out the balance of your AVC's just because you're aged 55+. They're pensions, so pension rules apply to them.
For most people it's best to take AVC's with main NRA60/65 benefits, as that's likely to be the most tax efficient. Although there's always exceptions.
Links to all RM pension related websites are here