Free-standing AVCs
A free-standing AVC arrangement is one which you make with a pensions provider of your choice: for instance, a bank, building society, insurance company or other pension provider.
You will not, however, have the same advantages which apply to the arrangements offered by the Plan, such as:
- contributions are deducted at source and tax relief is deducted at your marginal rate
- whereas Plan AVC arrangements can potentially all be taken as tax-free cash, only up to 25% of a free-standing arrangement can be taken as cash.
You will be responsible for your own AVC contract if you make a free-standing arrangement and you will have to arrange your own pension from this.