The 2013 Finance Act introduced a facility to allow certain people who have made Additional Voluntary Contributions to avail of once-off withdrawals of up to 30% of their fund value. Those eligible to avail of this and who wish to do so, have until 26th March 2016 to avail of this facility.
AVCs are a tax efficient way for pension-scheme members to save for their retirement. They are extra savings which you can make towards your pension to supplement the basic level of income supplied by the State pension.
The option applies to Occupation Pension Scheme AVCs, PRSA AVCs and Buy-Out Bonds with an AVC element only and not to any other type of pension payment.
It is important to note that such a withdrawal will be subject to tax at your marginal rate (0%, 20% or 40%)
While early access will be welcomed by many people, you should consider your options carefully before deciding to withdraw money from your AVC plan. For some, it will give immediate financial relief at a time when it is needed most. For others, particularly those who are still working and those close to retirement age, it may not be tax-efficient or prudent from a long term financial planning viewpoint to take early withdrawals from their AVC fund.
Please get in touch with us if you would like to discuss this matter further.