Retirement Planning:

Additional Voluntary Contribution (AVC)

An individual that is a member of an occupational (i.e. company) pension scheme can also make personal contributions to a separate pension arrangement called an AVC. The employee need to seek approval from their employer or the trustees of the scheme to set up their own AVC plan. However, it is possible that their Employer may already have an AVC plan in place. It may also be possible to establish a Self-Directed AVC structure allowing the beneficiary much greater investment control and flexibility with these funds.

The total personal contribution limits are determined by the individual’s age and is a percentage of their Net Relevant Earnings, up to an “earnings ceiling” of €115,000 as illustrated in the table below. Any personal contribution to the main company scheme also needs to be considered when calculating any potential contributions to an AVC plan.

AGE % of relevant earnings eligible for tax relief
Under 30 years 15%
30 – 39 years 20%
40 – 49 years 25%
50 – 54 years 30%
55 – 59 years 35%
Over 60 years 40%