Topping up my Prudential NHS AVC

pgbear

Dear all,

I currently pay 300/month into my NHS AVC. It is deducted by my employer from my monthly salary.

I wish to pay in a lump sum to top up my AVC. 
The form says I can pay "up to 100 percent of my pensionable pay" after deductions have been taken.

How do I calculate the maximum I can pay in?
Do I just look at my monthly take home pay and multiply by 12?
Do I have to subtract the 300/month from this figure too?

Thanking you in advance.

Vince

collins74

Your payroll/pension team should be able to advise you of the max.  When I have queried this with my pension team (local government) they said the contribution cannot go below the national minimum wage.  

As you probably know, lump sum contributions to AVCs are not allowed - its has to come from your salary.

On a separate note I have had issues with the Prudential portal while attempting to increase my AVCs and had to log a complaint - would be interesting to hear how you get on if you use Prudential.

Thanks

pgbear

collins74 said:

Your payroll/pension team should be able to advise you of the max.  When I have queried this with my pension team (local government) they said the contribution cannot go below the national minimum wage.  

As you probably know, lump sum contributions to AVCs are not allowed - its has to come from your salary.

On a separate note I have had issues with the Prudential portal while attempting to increase my AVCs and had to log a complaint - would be interesting to hear how you get on if you use Prudential.

Thanks

Thank you collins74. No, I did not know that. Crikey, that's really thrown me. 

So, there is no way to top up an AVC with a lump sum of savings? It has to all come out of my monthly pay?

Now I am not sure what to do, as I have already paid in the maximum allowed lump sum into my NHS pension. They only allow you to buy up to a maximum of 6565 pounds additional annual pension. I have managed to do that. It took me time, but I did it.

I assumed this meant that once I had done this, I cannot top up my NHS pension any more. Is that right?

Thank you for your help. 

Dazed_and_C0nfused

As you probably know, lump sum contributions to AVCs are not allowed - its has to come from your salary.

That doesn't seem to be what Prudential believe as they offer the option to make a gross payment by cheque.

https://www.mandg.com/pru/workplace-pensions/employees/public-sector-avc-schemes/nhs-avc-scheme

Looking at the notes this type of payment does not receive any tax relief from Prudential and you will find it hard going to get any tax relief from HMRC as they are notorious in not understanding these type of gross payments.

pgbear

Dazed_and_C0nfused said:

As you probably know, lump sum contributions to AVCs are not allowed - its has to come from your salary.

That doesn't seem to be what Prudential believe as they offer the option to make a gross payment by cheque.

https://www.mandg.com/pru/workplace-pensions/employees/public-sector-avc-schemes/nhs-avc-scheme

Looking at the notes this type of payment does not receive any tax relief from Prudential and you will find it hard going to get any tax relief from HMRC as they are notorious in not understanding these type of gross payments.

Thank you. The plot thickens. 

So may I go back to my original query:

"I wish to pay in a lump sum to top up my AVC. 
The form says I can pay "up to 100 percent of my pensionable pay" after deductions have been taken.

How do I calculate the maximum I can pay in?
Do I just look at my monthly take home pay and multiply by 12?
Do I have to subtract the 300/month from this figure too?"

I do have a form from the PRU which is titled "NHS AVC Single Premium Cheque Payment Form", which is why
I was a bit surprised by the first response to my original post.  Does anyone here have any experience of making such a payment?

collins74

Yes Pru does offer this but when I have tried to do it I was told it’s via salary only.  However mine is salary sacrifice so may be different.  Probably worth a call to check this out.