Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • Wentthedaywell?
    • By Wentthedaywell? 4th Jan 18, 7:29 PM
    • 457Posts
    • 2,487Thanks
    Wentthedaywell?
    LGPS AVC as tax free sum
    • #1
    • 4th Jan 18, 7:29 PM
    LGPS AVC as tax free sum 4th Jan 18 at 7:29 PM
    I think I may be getting confused with converting pension to a lump sum and taking a AVC as cash and would appreciate if anyone could clarify please.

    I recently took LG flexible retirement and I took all my benefits to date. These included a pre-2008 lump sum and an AVC as 100% tax-free cash.

    I am now working part time in the same job and have set up a new pension and AVC. Iíll only work for a couple more years so these arenít major considerations. The AVC is only £200 pm, as I understood I will only be able to take that as 100% tax free again if I keep it below 25% of my new pension value (capitalised by multiplying new pension by 20).

    I have just read, ďThe lump sum must not exceed £250,000 (25% of the lifetime allowance 2017/18) less the value of any other pension rights in payment.Ē Is this just referring to converting pension to a cash sum, or to AVCs?

    If the latter, do I need to take into account my existing pension (capitalised by multiplying x20) and previous lump sum and previous AVC? Must I keep ALL of this, plus the capitalised new pension and new AVC to below 25% of the grand total? Or have I misunderstood, and it is simply that I must keep my new AVC to <25% of my newly set up pension?
Page 1
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

1,640Posts Today

8,991Users online

Martin's Twitter