Simon Harris
Question:125. Deputy Simon Harris asked the Minister for Finance his position regarding pension AVCs; and his plans for alterations in the immediate future; and if he will make a statement on the matter. [41541/12]
View answerTuesday, 2 October 2012
Questions (125)
Written answers
Additional Voluntary Contributions (AVCs) may be made by employees in addition to any regular or compulsory contributions which they may make to their pension scheme. AVCs are eligible for tax relief at the employee’s marginal rate of income tax in the same way as regular contributions subject to the application of the annual earnings and age-related percentage relief limits which determine the overall amount of contributions that can be relieved in any one year. AVCs are used to improve the retirement benefits of scheme members, over and above those provided by the scheme rules but within the limits provided for under Revenue rules. AVCs can be used, within the limits imposed by the Revenue Commissioners, to:
- Increase basic pension entitlements or provide benefits based on non-pensionable pay;
- Increase retirement lump sums, if possible;
- Provide or increase dependants' provisions on death in retirement.
In common with regular contributions to pension saving, AVCs are locked in and may emerge only as benefits on death, retirement or leaving service.
I have no plans to make alterations to the tax treatment of pension AVCs in the immediate future.