Association of Higher Civil and Public Servants


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What happens if I have not worked my full 40 years?

You may want to retire at some stage before age 65. If so, you could find that you have not ‘clocked up’ the 40 years superannuated service you need to receive the maximum benefit provided by the Superannuation Scheme. The AVC Scheme provides a convenient way to help supplement the shortfall in pension and tax free lump sum benefits provided by the Superannuation Scheme.

Can I fund for additional Pension and Tax Free Lump sum if I’ve worked 40 years?

For those who have more than 40 years service, you may be surprised to learn that you could have substantial additional scope to fund for a higher pension in retirement, while attracting the generous tax relief available. This is subject to revenue limits.

Furthermore, those who have worked beyond their normal retirement date it may be possible to use an AVC plan to fund for an extra tax free lump sum subject to the Revenue’s maximum limits. For example: 42 years service at 62 equates to additional scope of 6/80’s tax free lump sum, above the 1 ½ max under superannuation limits. (This example assumes a normal retirement age of 60)

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What is an Approved Retirement Fund (ARF)?

An Approved Retirement Fund is a special type of investment fund designed specifically for the investment of the proceeds of certain types of pension plans (e.g. AVCs) at retirement. ARFs allow you flexibility in terms of how you use your AVC Investment Account at retirement. You can:

  • Choose from a range of different ARF investment options
  • Draw income from your ARF as and when you need to
  • Withdraw all of your investment in an ARF at any time (subject to Revenue regulations)
  • Use your ARF as part of your inheritance planning.

Income tax is deducted at source from the amount you draw down from your ARF. You can use part or all of your ARF at any time to purchase a pension (subject to Revenue regulations).

Can I make lump sum contributions to an AVC plan?

In additions to making contributions to your AVC plan on a regular basis through salary you may contribute to your AVC plan by way of:

  • A once off lump sum
  • A series of once off lump sums

Whichever way you choose to contribute to your AVC plan, the amount of any once off lump sum contributions will be restricted by the normal Revenue maximum limits as far as the benefits you may fund for through your AVC plan are concerned.

As far as tax relief is concerned, the normal limits on tax relief apply. In certain circumstances you may be able to spread tax relief on lump sum AVC contributions over more than one tax year (we recommend that you seek the expert advice from your Cornmarket consultant).

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What is the maximum I can contribute to an AVC?

Because of the extremely favorable tax regime applying to your AVC contributions and the growth within your AVC Investment Account, the Revenue has placed two limits on the amount you can contribute to your AVC plan.

  1. Your contributions cannot exceed the estimated amount necessary to provide you with your maximum pension entitlements at retirement age.
  2. In addition, the maximum AVC contribution you may make is limited to an overall contribution of:
Age% of salary*
Under 3015%
30 – 3920%
40 – 4925%
50 – 5430%

*The maximum % of salary contributable is dictated by the age you turn in that year i.e. if you turn 40 in April 2007, you can contribute 25% with affect from January 2007.

This overall contribution limit is calculated as a % of annual salary and takes into account contributions to the Superannuation, Spouses’ and Children’s and Purchase of Notional Service (PNS) Schemes, your contributions to the AVC Scheme, any previous service you may currently be buying back and any contributions to the AHCPS Group Life Plan (currently 0.65% of salary).

This means that if you are a pre April 1995 civil servant and are not a member of the PNS Scheme and not a member of the AHCPS Group Life Plan and not currently purchasing any other service, the maximum percentage of salary you may contribute each year to your AVC Investment Account (assuming you have the necessary ‘scope’ in terms of years of service, etc.) is calculated as follows:

AgeRevenue LimitSuperannuation and Spouses’ & Children’s Scheme ContributionMaximum AVC Contribution (D1/B1 PRSI)
Less than 3015%1.5%13.5%
30 – 3920%1.5%18.5%
40 – 4925%1.5%23.5%
50 - 5430%1.5%28.5%
55 - 5935%1.5%33.5%

If you are Post April 1995 and in the same scenario, the maximum percentage of salary you may contribute each year to your AVC is calculated as follows:

AgeRevenue LimitSuperannuation and Spouses’ & Children’s Scheme ContributionMaximum AVC Contribution (A1 PRSI)
Less than 3015%5.5%9.5%
30 – 3920%5.5%19.5%
40 – 4925%5.5%19.5%
50 – 5430%5.5%24.5%
55 – 5935%5.5%29.5%

The above scope is based on a salary of €75k and A1 PRSI

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Are contributions eligible for Tax Relief and how do I claim it?

  • Regular contributions – Tax and PRSI relief will be incorporated automatically in your salary each pay period.
  • Lump sum – You will need to claim back the tax and PRSI relief on any lump sum contribution into your AVC plan. (We recommend you seek expert advice from your Cornmarket consultant if you are planning once off lump sum contributions).

What happens if I take a career break?

You should write to Cornmarket as soon as you are certain you are going to take a career break. Your contributions will cease as soon as your salary stops. In the interim your investment Account will continue to reflect the returns earned by the investment funds.

Upon returning to your job you should contact Cornmarket to arrange for your AVC contributions to start again. You may also wish to consider increasing your AVC at that stage to make up the shortfall resulting from the years of service you missed whilst on career break.

For this reason it is important that you contact Cornmarket prior to taking your career break to discuss your options.

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What happens if I leave the public sector?

If you resign, the Revenue insists that your AVC benefits are treated in the same way as your Superannuation benefits:

  • If you are entitled to a refund of your superannuation contributions, you must also take a refund of the value of your AVC Investment Account when you resign.
  • If you are not entitled to take a refund of your superannuation contributions, you must leave your AVC contributions to accumulate in your AVC Investment Account until retirement.

What happens if I transfer from another union to the AHCPS?

AVC Schemes are in operation for members of most unions within the public sector. This means that often when public sector employees transfer into the AHCPS from another union such as the PSEU, CPSU, they are already members of an AVC Scheme. If you already have an AVC plan and are transferring into the AHCPS, you should contact Cornmarket who will investigate the best course of action for you regarding your AVC plan.

Where it is to your advantage to do so Cornmarket will transfer you to the AHCPS AVC Scheme and will be happy to waive any initial consultancy fee that may be involved.

Cornmarket Group Financial Services Ltd. is regulated by the Financial Regulator. Telephone calls may be recorded for quality control purposes. A member of the Irish Life & Permanent Group.


© 2021 Association of Higher Civil and Public Servants

  • Fleming's Hall 12 Fleming's Place Dublin 4 
  • Phone: +353 1 6686077 / 6686064
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Association of Higher Civil and Public Servants