FAQs

Our team has taken the time to answer some of the day-to-day FAQs our existing and past clients ask.

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Frequently Asked Questions

How do I start a pension?

The process of starting a pension is relatively straightforward. Assessing your overall financial situation will be the first step. From here yourself and your financial adviser can discuss contributions and a plan going forward.

Why should I have a pension?

Having a pension will give additional income in retirement. The State pension is currently a modest €248 a week. If the thought of surviving on €35 a day isn’t enough, the tax benefits of starting a pension are also attractive.

What is the best age to start a pension?

There is no one-size-fits-all when it comes to pension. The best time to start is today. Whether you are starting a pension at 30 or later in life, we would be happy to guide you through the process.

Do pensions get tax relief?

Yes. You will receive income tax relief against earnings from your retirement for your pension contributions. Tax relief is given at your marginal rate. We have broken these into real-life examples.

How much should I contribute to my pension?

Again, there is no universal answer. It will depend on your overall financial situation. Although it is recommended that you contribute as much as possible within the thresholds.

Where are pensions invested?

Your pension can be invested in a wide range of fund choices. Often, people will choose to invest in a multi-asset style to diversify risk. This means it may be invested in a mixture of bonds, cash, equities and property for example.

What is a personal pension?

A personal pension or private pension are pensions organised individually by self-employed people or those who do not have access to an occupational pension scheme.  These personal pensions are managed by a life assurance or investment company.

What is a PRSA?

A Personal Retirement Savings Account is similar to a personal pension. It can be taken out with an authorised PRSA provider. It’s purpose is to help you save for retirement. You have the ability to make regular contributions which are tax deductible within certain limits.

What is a Buy-Out-Bond?

A Buy-Out-Bond can also be referred to as a Personal Retirement Bond (PRB). A Buy-Out-Bond allows you to transfer for an occupational pension scheme into a policy in your own name.

Is there a limit to how much I can contribute to my pension?

Yes. This will vary depending on your age and occupation.

Age % net relevant earnings
Under 30 15%
30-39 20%
40-49 25%
50-54 30%
55-59 35%
60 or over 40%

(Up to a limit of €115,000 per year)

Can I transfer a UK pension to Ireland?

If you have a private pension from working in the UK, it is likely you will be able to transfer your benefits. There are certain benefits of transferring your UK pension back to Ireland. However, as with most aspects of pensions, there are several factors to consider. Ensure you enlist the help of a qualified professional to assist you.

Can I cash in my pension?

Having the ability to cash in your pension early will depend on a number of factors. Your age and the type of pension scheme will be the main considerations. As a rule of thumb, you normally cannot access your pension until age 60. However, in certain circumstances, you will have the ability to access from 50.

What is the earliest age I can access my pension?

In certain cases of ill-health you may be eligible to access your pension early. Also, if you have a pension from a previous employer, you may be eligible to access your benefits from age 50.

Can you get a tax-free lump sum from a pension?

Again, this will be dependent on a number of factors along with the scheme type. As a general note, you will likely be able to access a lump sum from most pension arrangements. If you are unsure, it is never a bad idea to review your pension.

What is the maximum pension lump-sum I can take?

25% of the value of your policy. You are entitled to take 25% of your pension benefit tax-free up to a lifetime limit of €200,000. The next €300,000 will be taxed at 20%. Any remaining balance will be taxed at your marginal rate and liable to USC.

What happens to my pension if I die?

Most pension benefits will be inheritable. However, it will depend on the scheme type and the relationship of the beneficiary when it comes to tax liabilities.

Can I cash in a pension from a previous employment?

Transferring your pension from previous employment may enable you to access it in certain circumstances. Often if you transfer from an occupational pension scheme to a PRB you may be eligible to access your benefits from age 50.

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