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Can I take AVC before company pension?

Retirement | Pension Rules Helpful? 10

Asked by steve, submitted 06 July 2013.

Open Quote I paid into an AA pension for 12 years plus AVCs to Equitable Life. Can I take the AVC to buy an annuity before drawing my AA Company Pension?. My year of birth is D.O.B 1955.End Quote

Answered by Justin on 23 August 2013

Yes, in theory it's possible to take benefits from an Additional Voluntary Contribution (AVC) pension scheme before or after you take benefits from your occupational pension, provided you are age 55 or over (which you obviously are).

However, it all depends on whether your AA pension scheme rules allow this (just because HMRC rules do, it doesn't automatically mean your pension scheme does), so you'll need to check with the AA pension scheme administrator.

If the AA pension scheme does allow you to take the AVC before your AA pension then you have the option of taking 25% of the AVC fund as a tax free lump sum with the balance used to buy an annuity. It's the usual retirement gamble of receiving less income now but for longer or more in future for a shorter overall period of time. There's no right or wrong as such, it depends on how long you think you'll live and prevailing annuity rates. And, of course, how keen you are to get some extra income now.


Please note this answer does not constitute a recommendation or financial advice and should not be relied upon when making specific investment or other financial decisions. You should always undertake your own research into whether a product or service is appropriate for your needs and, if necessary, use a qualified professional adviser.

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