Allen & Overy Pension Scheme
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How much can I contribute?

By paying into the Scheme now, you are taking important steps towards preparing for retirement.

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How much does Allen & Overy contribute and how much do I contribute?
All members of the DC Section may participate on a non-contributory basis and receive Allen & Overy's Core Contributions only. However, if you wish to take advantage of Allen & Overy's Matching Contributions (which are paid in addition to the Core Contributions) you must make a contribution yourself.

Contribution levels are set on an age-related scale (see the flow chart below for details). Allen & Overy's contributions to the DC Section of the Scheme are shown below and will either be paid in by Allen & Overy or credited from the general assets of the Scheme.

Contribution levels flowchart

All the contribution types detailed above are based on your capped Pensionable Salary, and are deducted automatically via payroll from your pay in order to ensure the correct tax relief is granted at source.
Can I pay extra above the matched contribution levels?

You can pay Additional Voluntary Contributions (AVCs) but they will not attract any further contributions from Allen & Overy. AVCs plus any Ordinary Contributions can be made up to a maximum of 80% of gross monthly earnings from Allen & Overy. AVCs are processed through the payroll in order for you to receive your full tax relief at your highest marginal rate. Restrictions apply to ensure you leave enough pay to cover your other statutory deductions such as National Insurance.

If your pension savings exceed the £40,000 Annual Allowance in any Pension Input Period (PIP), a special tax charge is payable on the surplus savings above this amount. The PIP under the Scheme has historically been the calendar year to 31 December. However with effect from 8 July 2015, the Government changed this for all schemes so that it would align with the tax year. Thus, your Pension Input Period for the 2017/18 tax year will be the year 6 April 2017 to 5 April 2018. Due to payroll processing, the last contribution that will be included in the current PIP year will be your February contribution, which is invested in March. Your March contribution will be received after 5 April and will therefore be recorded in the following PIP year. We recommend that you seek financial/tax advice if you think you will be likely to exceed this allowance.

The Annual Allowance (AA) is the amount of pension savings that can be made in a single tax year before extra tax is payable. The AA for the 2016/17 and 2017/18 tax years is £40,000 for most people, but it will be less for those whom the pensions tax regime deems to be on "high income". Broadly speaking, if your total taxable income is above £110,000 (which includes any taxable income from outside of your Allen & Overy employment) in a tax year, then you could have a personal AA which is below £40,000. The Firm as your employer does not have visibility of all your income so you will need to calculate what your personal AA limit is.

Please refer to the Annual Allowance, Lifetime Allowance and Pension Input Period notes in the Glossary of terms section for information on the maximum tax free payments you may make to your pension arrangements.

Matched Contribution Levels

Can I change my contribution rate?
Yes. When you first join the Scheme, or start to make Ordinary Contributions, you choose your contribution level subject to the maximum levels in the diagram in the question above. You can pick any whole percentage, including nil% up to the maximum for your age band. When you move into the next age band you will be able to make contributions at a higher level from the 1st January following your birthday.

Allen & Overy’s Core Contributions automatically increase with effect from the 1st January following any change to your age band. If you wish to contribute at the higher level, as Allen & Overy’s Matching Contributions will only be increased if you increase your own contributions, you will need to make the change through 'My Self Service'.

Can I change my contribution rate before the 1st January?
Yes. You can change your Ordinary Contribution level during the year, subject to the maximum levels in the table above. To make a change you should access 'My Self-Service' and your instructions will be processed on the 1st of the following month. You may change your contribution level no more than twice in any twelve month period. If you want to make a third change in a twelve month period, you need the consent of the Trustee. You can however change your AVC level at any time via 'My Self-Service'.

How do I make my contributions?
Your Ordinary Contributions and your AVCs will be automatically deducted from your salary via payroll.

Look at what you save!

The actual cost of membership to you is reduced because you receive tax relief on your contributions. For every £1 you pay, your take-home pay is only reduced by 80p if you are a basic rate tax payer, because you receive tax relief of 20% (higher rate tax payers may also be eligible for further tax relief).