AVC

AVC – Additional Voluntary Contributions are non compulsory payments made by a member of an employer's pension scheme who wants to top up their retirement benefits. Such payments qualify for tax relief at the maximum level, although the ultimate benefits must not exceed two-thirds of the final salary and the contribution level should not exceed 15% of the employee's total remuneration package (including taxable benefits) in any one year. Employees have the right to select their own personal schemes which can be quite separate from any existing arrangements, although though such a scheme can only be used to enhance pension (rather than cash) benefits on retirement. If an employee selects a plan separate from the employer-sponsored scheme it is known as a free standing additional voluntary contribution.

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