Tax Relievable Pension Contributions

  • Deadlines approaching

 

Tax Relievable Pension Contributions

Making tax relievable contributions to your pension is an easy and effective way to help you achieve your financial goals.

The tax deadline to make contributions against 2017 earnings is approaching, so now is a good time to top up your pension and claim up to 40% tax back. The deadlines are as follows:

  • 31st October 2018 – If you do not pay and file through Revenue Online System (ROS) and do not qualify for the extension

  • 14th November 2018 – If you pay and file your returns online through ROS

The amount of tax relief you can get on your contributions depends on your age:

 Age in Tax Year Maximum Contribution as a % of Earnings* Maximum Tax Relievable (Maximum Contribution)
 Under 30 15% €17,250
 30-39 20% €23,000
 40-49 25% €28,750
 50-54 30% €34,500
 55-59 35% €40,250
 Over 60 40% €46,000

Source: Davy, Revenue as of September 2018 

Contributions must be paid to your pension and returns must be filed with Revenue on or before the deadline above.

* Earnings: Earnings from a self-employed trade or profession assessable under Schedule D or remuneration from an office or employment assessable under Schedule E, subject to a cap of €115,000 for 2017 which may increase at a rate determined by the Minister for Finance.


Tax relief on contributions in excess of the limits can be carried forward and relief is granted in future years.

 

Who can make a contribution? 

Self Employed (If you paid income tax in 2017 under Schedule D which was derived from carrying on a trade or profession)

Contributions can be made to:

  • A Personal Retirement Savings Account (PRSA)

  • A Personal Pension or Retirement Annuity Contract (RAC)

Employed (If you paid income tax in 2017 under Schedule E on income from an office or employment)
If you are a member of an occupational scheme associated with your company, contributions can be made to:

  • The company scheme (if the scheme can facilitate)

  • The AVC (additional voluntary contribution) scheme (if there is a separate AVC scheme provided)

  • An AVC PRSA

If you are NOT a member of your company’s occupational scheme, contributions can be made to:

  • A PRSA

  • A Personal Pension or Retirement Annuity Contract (RAC)

It should be noted that contributions by an employer to a PRSA, Personal Pension or RAC contribute towards the limits set out in the maximum contribution table above. Additionally, if you have left service of the employer it may not be possible to make a contribution against this employed income.

We conduct an initial no obligation discussion to explain the pension solutions available to you.

Call us on 01 614 3311 or email pensions@davyselect.ie

Detailed criteria must be satisfied in order for a pension contribution to qualify for tax relief.  The tax information contained herein is based on Davy’s current understanding of the tax legislation in Ireland and the Revenue interpretation thereof. It is provided by way of general guidance only and is neither exhaustive nor definitive and is subject to change without notice. It is not a substitute for professional advice. You should consult your tax advisor about the rules that apply in your individual circumstances. Davy is not responsible for the interpretation of this information and any submissions made by you or a third party on your behalf thereon.

Warning: This information is based on Davy’s understanding of current tax legislation in Ireland and is subject to change without notice. It is intended as a guide only and not as a substitute for professional advice. You should consult your tax adviser for the rules that apply in your individual circumstances.