Bonus and pension top up

[Lucy83]

Hi,

I received a bonus of €5000 into my monthly wages. On the higher rate of tax. If I put this amount into my pension as a voluntary contribution will I get tax relief on at the 40% rate at the end of the year? Or am I better to increase my monthly contribution from my wages? Thanks for
the advice?

 

[Steven Barrett]

You can claim the tax relief from the revenue once you have confirmation that the payment has been made. You don't have to wait until the start of the new year. You will get 40% of it back assuming you are paying tax at the higher rate and you haven't gone over the personal tax relief thresholds.




Steven
http://www.bluewatefp.ie (www.bluewatefp.ie)

 

[Lucy83]

You can claim the tax relief from the revenue once you have confirmation that the payment has been made. You don't have to wait until the start of the new year. You will get 40% of it back assuming you are paying tax at the higher rate and you haven't gone over the personal tax relief thresholds.




Steven
http://www.bluewatefp.ie (www.bluewatefp.ie)

Thanks very much for that Steven.

 

[NotEnough]

Keep in mind that once that money goes to the pension fund it's gone (until you retire of course ). If you choose to increase your monthly contribution you will still have it (although less and less each month) and you'll benefit from the dollar/euro cost average averaging.