AVC versus Single premium

[phoenix53]

HI. I've managed to tie myself up in knots over this question . I'm sure the answer is probably simple but i can't see it.

My husband contributes to a PRSA monthly and his employer also contributes. He does not max out his 40% tax relief with the monthly contributions but at the end of each year, for the past few years, he makes a single premium contribution to his PRSA for as much as he can afford.

What is the difference between making an additional single premium contribution to the PRSA and taking out an AVC? Is there a difference?

Thank you.

 

[bstop]

AVCs are associated with an occupational pension. If your husband does not have an occupational pension he cannot make AVCs.
He has a PRSA and he can choose whatever way he wants to make his contributions.
The main advantage of the monthly contributions are that they are probably deducted at source from his wages and he gets tax relief directly from each deduction.
An advantage of making an extra single premium payment at the end of the year is, assuming he makes this directly to the PRSA provider, that his employer has no knowledge of this extra payment. This can be to his advantage if he is seeking a cost of living pay increase from his employer. The employer does not know that he has enough spare income to increase his pension.
The limits for tax relief per year are the same for either AVCs or PRSAs.

 

[phoenix53]

AVCs are associated with an occupational pension. If your husband does not have an occupational pension he cannot make AVCs.
He has a PRSA and he can choose whatever way he wants to make his contributions.
The main advantage of the monthly contributions are that they are probably deducted at source from his wages and he gets tax relief directly from each deduction.
An advantage of making an extra single premium payment at the end of the year is, assuming he makes this directly to the PRSA provider, that his employer has no knowledge of this extra payment. This can be to his advantage if he is seeking a cost of living pay increase from his employer. The employer does not know that he has enough spare income to increase his pension.
The limits for tax relief per year are the same for either AVCs or PRSAs.

Thank you for taking the time to reply. That clears it up.