Regarding best use of AVC retirement benefits this will depend on all retirement benefits taken from relevant employment, how they were taken, number of years service e.t.c.
AVC benefits are normally attached to Employee Retirement Scheme Benefits. The manner in which you draw these benefits depends on the benefits taken from Employee Retirement Scheme. Traditionally AVC benefits would be used to pay out a Tax Free Lump Sum so that no Tax Free Lump Sum is paid out of company pension scheme (this serves to maximise pension income from the company retirement plan, particularly if it is a Defined Benefit Scheme). However, civil service schemes are slightly different, & this tends not to occur.
As you can see from above paragraph, without having all of the information to hand, establishing your options starts to get a little complicated! This is because your options with respect to "best use" of AVC depends on which options were offered and chosen with respect of Employee Benefit Scheme, as well as any other retained benefits.
Strongly advise bringing all available documentation to an independent Financial Advisor. Documentation should include: Retirement Benefit Options Statements or Leaving Service Options in respect of Employee Pension Plan and AVC, copy of correspondence accompanying any cheques received (if applicable).
One thing to be careful of, is that the value of the AVC may be guaranteed within a certain number of days from retirement. This will be written on your AVC Retirement correspondence. This depends on the investment fund your AVCs are invested in. If the monies are invested in this type of fund, the value could dramatically reduce (MVA) if you delay beyond the prescribed number of days. Therefore I would urge you to speak with a Financial Advisor sooner rather than later. (usually there should be no charge for consultation).
Finally, taking the balance of the fund as a Taxable Lump Sum i.e. paying full income tax on it, at your marginal rate is more than likely an option open to you. However there is probably a better way for you to use the AVC monies.