AVCs can get me under 40% ??

pennine

At the moment the AVC way seems the most convenient for me, as I just fax a form to my payroll department in work and my salary is transferred totally into AVCs. I can then manage my AVCs myself moving between funds online if I am not happy with their performance. I will be honest and say that I do not know what the charges are however, but they do seem to be popular with a lot of the guys in work who are also going down this route. The company is Fidelity by the way.

dunstonh

At the moment the AVC way seems the most convenient for me, as I just fax a form to my payroll department in work and my salary is transferred totally into AVCs.

What will be your tax position at age 65 (I know you plan early but there is an age allowance reduction at 65 if you have above 20,900 income).

It seems you are jumping in with convenience rather than using what may be the better option in the long run. Especially as higher rate tax relief does not appear to be an issue now. Maximising your ISA allowance and any surplus into unit trusts would seem much more favourable. Especially if there is the chance you could be into higher rate in future years.

jem16

dunstonh wrote: »

Especially as higher rate tax relief does not appear to be an issue now.

We need pennine to clear this up as higher rate tax may still be an issue for him.

Based on Taxable earnings of £36,232 so far this year ( i.e. 9 months? ) he would be looking at £4025 each month. So although he still has £3549 of his 22% band remaining he is going into higher rate tax before the tax year is finished. Plus he will have to add in his interest from savings.

Unless of course his earnings so far also include bonuses and that is not his normal monthly wage.

pennine

It would appear that the best way forward for me this year is AVCs. Next year I will be investing in avcs and unit trusts to make the most of my £9200 capital gains tax allowance.
I now need to do a bit of catching up on how unit trusts work. I don't wish to hog the board any longer with this post, it must be getting boring.
Many thanks to all those who have helped, I'll no doubt be picking more brains when I get stuck.