Boost your pension
If you’d like to buy more benefits at retirement, you can pay Additional Voluntary Contributions (AVCs). There are two kinds of AVCs:
- Money purchase AVCs
- Added years AVCs
The AVC guide explains everything you need to know about the different kinds of AVC and about paying more. There are some risks with AVCs, so please read the guide carefully before you make a decision.
What's the process?
Switching your funds
If you already have money purchase AVCs, you can change your investment funds at any time. You can do this by logging in to your account via Clarity from BW or completing an AVC change form
TAX ALLOWANCES
A pension is one of the most tax-efficient ways to save, but there are some limits on how much you can pay in each year.
Annual Allowance
Your Annual Allowance (AA) is the most you can save into your pension in a tax year (6 April to 5 April) before you have to pay tax. For most people, the standard AA is £60,000. If you exceed the AA, we’ll send you a Pension Savings Statement in October.
If you’ve flexibly accessed any defined contribution pension savings but continue to pay into a defined contribution pension arrangement (such as Money Purchase AVCs), the Money Purchase Annual Allowance will apply to you, which is £10,000. (Your AA for your defined benefit pension savings would then be £50,000.)
If you’re a high earner, with an annual income over £200,000, the Tapered Annual Allowance (TAA) may affect you. If you have an adjusted income above £260,000 a year, your AA will be reduced and could be as low as £10,000.
Please see the government website for further information about these annual allowances.
Lifetime Allowance
The Lifetime Allowance (LTA) was a limit placed on the amount of pension savings you could build up from all workplace and private pensions before paying a tax charge. In April 2024, the LTA was abolished.