LGPS AVC's to generate a tax free lump sum

AlanP_2

To get £50k CONTRIBUTED to the AVC pot in 36 months you need to set up monthly contributions of £1388.89. This is the equivalent of £40k after tax or £1111.11 per month.

The contributions will be invested in the choice(s) you make from those offered by the Pru and could go UP or DOWN over the next 36 months the same as any other investments.

As you have 33 years LGPS service that includes a significant amount of pre-2008 pension scheme benefits which included an automatic lump sum. This will be added to your AVC pot value to determine whether the total TFLS falls within the 25% limits.

The calculation is:

((Annual LGPS Pension * 20) + Auto Lump Sum + AVC) / 4 

NOTE - You can also commute (swap) annual pension for more Lump Sum at a rate of £1 pension foregone for £12 lump sum. This is a very low rate and is not usually the best thing to do. However if you did choose this option then the additional Lump Sum will need to be included in the above calculation.

If you are at £1m plus before dividing by 4, or have other pensions, then LTA may be an issue but unlikely I would have thought.