Can I AVC my Xmas bonus

tracyk23

Ooft - very grateful for my Xmas bonus but have been whacked in tax. Can I send most of my bonus to my company Nest pension as an AVC to save tax? We don't have salary sacrifice set up yet - but if it's quick I could set it up for the company - so maybe others that have been whacked have the option also?

Woodstok2000

If you've already received the bonus it's too late to do it as salary sacrifice, but you can still pay it in as your own contribution to get tax relief that way.

tracyk23

Woodstok2000 said:

If you've already received the bonus it's too late to do it as salary sacrifice, but you can still pay it in as your own contribution to get tax relief that way.

I'm processing the wages just now - so not paid yet...

Marcon

tracyk23 said:

Ooft - very grateful for my Xmas bonus but have been whacked in tax. Can I send most of my bonus to my company Nest pension as an AVC to save tax? We don't have salary sacrifice set up yet - but if it's quick I could set it up for the company - so maybe others that have been whacked have the option also?

It's not the instant process you are hoping for - and as you are already 'beneficially entitled' to your bonus, might not work anyway.

You'll get the same tax saving if you make a personal contribution to NEST; there just won't be any NI saving for employer or employee.

penners324

AVCs are only for those in a DB scheme. Probably public sector.

Nest doesn't deal with those.

If you want to make a pension contribution to Nest then, yes you can. Their website and app will tell you how to do this.

penners324

tracyk23 said:

Ooft - very grateful for my Xmas bonus but have been whacked in tax. Can I send most of my bonus to my company Nest pension as an AVC to save tax? We don't have salary sacrifice set up yet - but if it's quick I could set it up for the company - so maybe others that have been whacked have the option also?

You can't just set up salary sacrifice. It's a contractual change so you need to do a consultation with employees. So will take at least 2 months

Albermarle

penners324 said:

tracyk23 said:

Ooft - very grateful for my Xmas bonus but have been whacked in tax. Can I send most of my bonus to my company Nest pension as an AVC to save tax? We don't have salary sacrifice set up yet - but if it's quick I could set it up for the company - so maybe others that have been whacked have the option also?

You can't just set up salary sacrifice. It's a contractual change so you need to do a consultation with employees. So will take at least 2 months

Plus you would need to exchange info with Nest.
Salary sacrifice | Nest pensions

Alexland

penners324 said:

AVCs are only for those in a DB scheme. Probably public sector..

My private sector employer calls the extra contributions (above the base contribution) we choose to make into our DC pensions AVCs.

(and ASCs if we elect to use salary swap)

So we can ASC down to the minimum wage then AVC down to the personal allowance if we want.

Marcon

penners324 said:

AVCs are only for those in a DB scheme. Probably public sector.

Times change, so does use of terminology. A lot of employers choose to use the terminology because employees understand it, regardless of the type of scheme in question. Makes sense when you think about it: 'Additional' because it's on top of any contribution required as a condition of membership, and 'Voluntary' because an employee can choose whether or not to make such a contribution.

tracyk23

Marcon said:

penners324 said:

AVCs are only for those in a DB scheme. Probably public sector.

Times change, so does use of terminology. A lot of employers choose to use the terminology because employees understand it, regardless of the type of scheme in question. Makes sense when you think about it: 'Additional' because it's on top of any contribution required as a condition of membership, and 'Voluntary' because an employee can choose whether or not to make such a contribution.

lol - I'm showing my age! I've only ever known it as an AVC (always private sector)