What are the Tax Benefits?
Based on the current tax legislation, any contribution you make
into your pension scheme will be eligible for full income tax
relief at your current tax rate. In addition, because your
contributions to the pension scheme are deducted through the
payroll system from your Employer, this relief is automatic!
Let's look at some examples!
The example below shows you the actual cost to you of your
contributions.
Are there any limits on how much I can
pay?
Yes, there are some limits depending on your age and salary but
these are still quite generous as shown in the table below. For
example, someone in their 40s can pay up to 25% of their taxable
earnings to their pension scheme in any tax year, and get full tax
relief on it - the limit includes all of your own contributions but
not the company's contributions, which can be paid in addition
(unless you are in a group PRSA scheme).
There is an earnings cap that applies to high earners, so
tax-relief can't be claimed on any earnings above €115,000 a
year.
Are there any other tax reliefs?
Yes - any contributions your employer makes to your pension are
free of tax.
Also, any investment returns on your pension fund are free of
DIRT tax or Capital Gains Tax.
If you want more information on your company pension scheme
please contact your HR department or corporate@invesco.ie.
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