Information Circular No 32/2010 – Last Minute Additional Voluntary Contributions – AVCs

By Industrial Relations Officer

Significant numbers of PDFORRA members will retire from the Defence Forces this year.  If you are planning on retiring and are aged over 50, you may have an opportunity to increase your tax-free cash entitlement when you retire.

 What is a Last Minute AVC? :                     A Last Minute AVC is a revenue approved mechanism which enables tax payers to maximise their tax free cash prior to retirement, within revenue limits.

A last minute AVC is an excellent way of funding any shortfall in pension provision between the tax-free cash lump sum provided for within the superannuation scheme and the maximum revenue approved tax-free cash entitlement.

 Benefits of Investing in a Last Minute AVC:

  • Receive a tax refund on your contribution.
  • Maximise your tax-free cash lump sum at retirement.

 Benefits for PDFORRA Members:              Members of the Defence Forces with 31 years service are entitled to 65 weeks pay related gratuity on retirement.  Revenue limits provide for 78 weeks pay related gratuity on retirement.  Therefore PDF personnel over 50 years of age with 31 years service have an opportunity to avail of a maximum 13 weeks pay related tax-free cash lump sum on retirement.

 How does the Last Minute AVC Work?      A retiring member makes a single investment in an AVC prior to leaving the Defence Forces.  After their retirement the member receives a tax rebate less charges direct from Revenue following the submission of all appropriate paperwork.  Retiring PDFORRA members aged over 50 can achieve substantial net gains on their investment within a number of weeks.

 How are Last Minute AVC Charges Calculated?               Normally fees are calculated at 5% of the value of the investment.  However, PDFORRA members can avail of special reduced charges with minimum fees of €50 and maximum fees of €100.  Please contact Martin & Garvan Insurances on (01) 837 9276 or PDFORRA on Freephone 1800 200 250 for information on Last Minute AVCs prior to retiring from the Defence Forces.

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