The deadline for final tax payment for the 2020 tax year under the self-assessment system is fast approaching. One way to reduce your tax liability is to make a contribution to an approved pension arrangement.
Income-tax relief is available from the pension contributions you make to one of the following pension arrangements:
- Occupational pension schemes,
- Personal retirement saving accounts,
- Retirement annuity contracts.
Tax relief is available at your marginal rate of tax, subject to an earnings limit of €115,000 and contribution rates which are dependent upon your age as follows:
There are also tax advantages at retirement, in that you can take up to 25% of your fund as a lump sum, with up to the €200,000 available tax free. Your funds also accumulate tax free while invested.
You can still be eligible for a tax refund for 2020 by putting money into a pension scheme and submitting a claim to the Revenue before 31 October 2021 (later if you submit your return online).
Law Society members who are self-employed, in partnership, or in non-pensionable employment are eligible to make a pension contribution to the Law Society Retirement Trust Scheme. The scheme offers all the flexibility of a personal policy and, in addition, offers a number of enhanced features, including a simple and transparent charging structure and best-in-class investment management. There is also a flexible ‘lifestyle strategy’ in place that gradually reduces the level of equity risk in your retirement fund the closer you get to your chosen retirement age.
There are currently five fund offerings available to members of the Society under the Retirement Trust Scheme, which the investment committee is confident represent high-quality retirement and tax-saving solutions to members.
More information can be obtained from the scheme administrator at Mercer by emailing JustASK@mercer.com or by phoning 1890 275 275. A copy of the explanatory booklet can also be found on the Law Society’s website.
This communication is provided for information only and does not provide advice or a recommendation. Mercer (Ireland) Ltd, trading as Mercer, is regulated by the Central Bank of Ireland. Registered Office: Charlotte House, Charlemont Street, Dublin 2. Registered in Ireland No 28158.
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