Can I "Top Up" My Army Pension?

Discussion in 'Armed Forces Pension Scheme' started by f_r_e_a_k_i, Mar 11, 2006.

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  1. I am looking into "topping up" my Army pension. I have heard that you can contribute, pre-tax, additional funds? Does anyone know if/how this is possible and any limitations on the amount that can be added?

    Additionally, would it be of greater finacial benifit to do the above (if possible) or contribute into an additional pension scheme, if so which one?
  2. You could take out Additional Voluntary Contributions (AVC) under the old AFPS 75, but as far as I am aware they provided a larger death in service benefit, not an actual bigger pension.

    The only way that I know is to take out a Stakeholder Pension from a civvy company, Scottish Widows etc were offering them a few years ago, and the wife still has hers up and running :lol:

    Been out of the Pay world a few years now, so not as current as some might be.

    In short I would say NO !!
  3. It is possible to buy in added years in some cases, best thing to do is speak to yor FSA or RAO - if they deny all knowlege of such a thing be persistant, they may have to dig a bit in the regs but it is there!
  4. Things have moved on.

    Post 5 april this year, full concurency comes in - this means that you can be a member of a pensions scheme AND contribute towards a personal pensions.

    Whatever you do, SEE AN IFA

  5. Thanks for the advice, it looks as though a second pension is the solution.
  6. Freaki, be vey careful to check you do not breech the HMRC limits on how much you can have as a pension, if you do you will have wasted your money. Visit a reliable (topnotch) independant finanical advisor
  7. Paymaster

    You are about to become out of date.

    The HMRC limits on personal contributions to a personal pension will be the lower of you actual P60 income, or £215000. There will be no bar on having a PP while you are a member of an Occupational Scheme from 6 april.

    To be really pedantic, the Lifetime Allowance for an individual will be for an amount of £1.5 million, indexed. Final salary pensions ( such as the AFPS ) will be deemed to be worth £20 for every £1 of pension - ie the maximum pension under HMRC limits for the AFPS will be £75,000. This would require a Final Pensionable Salary, at todays' prices. of about £100k.

    So, unless the AFPS pensions exceeds this amount ( which will be indexed ) HMRC limits will not be breached.

    ( Yes, I passed CF9. )
  8. Is this going to change the commutation rules then? Under the new system (from A-Day), I believe you can take up to 25% from a final pay pension scheme - does this mean that we can increase the amount we take as a tax-free lump sum?
  9. in_the_cheapseats

    in_the_cheapseats LE Moderator

    My understanding of it is that you can take this sum at the age of 55 and not before for civilian funds however I haven't seen any detail on military provisions. Don't see why there should be a difference, though.

    The Sunday Times did a pretty good series of articles in its Money section yesterday about A Day changes.
  10. I've just signed up for the maximum 15% of annual (gross) pay's worth of AVCs. The pay office denied all knowledge, but I managed to get the phone number of the pensions department at Glasgow. They were really helpful, faxing me the details and application form. I wish I'd done this a couple of years ago, as the maximum 15% will still leave me a couple of years short of a full pension.
  11. On what basis are your AVCs? Added years or a straight pension depending on the fund performance?

    After 4 april, you could put thta amount into a personal pension and at retirement, take 25% of it as tax free cash.

  12. Bison, can you explain how this works, as i have never heard of this. Does each annual 15% buy you so many years? What happens if you get promoted?
  13. Tenovatio

    I've asked that question, but only immediately above your post.
  14. No, you missed the point on asking about promotion. As your pension is paid on a representitive rate for your rank, paying excess contributions then getting a promotion can lead to you losing out; in some cases!
  15. Percy_Pigeon

    Percy_Pigeon War Hero Book Reviewer

    Interesting stuff.

    Yet again I wish I knew of it when I was a Tom. Rather expensive now I’m afraid.

    Still good stuff, I will follow with interest.