Defence Forces Pensions and AVC's

seánieboy

Registered User
Messages
165
Re: AVC's for Public Servants

hello,
Ive been listening on the media for some time now about pensions and how they could benefit a person if one was on 42% tax rate well im on that rate and havent a clue where or how to start researching the subject there is so much to take in and it all seems to be in legalesse language and making not much sense to the working man.

I myself am in the defence forces for 20 years now and next year I can go out on a 21 year pension.

For me to leave next year i would get €250
(approximately) a week and if i stayed until 31 years this pension would rise to €330 a week through various increments throughout between 21 and 31 years of service.

Then at the age of 65 this 31 year pension reverts back to the 21 year rate bearing in mind that this pension is non-contributary and is indexed linked to benchmarking and other payrises. Also i would be entitled to the old age contributary pension.

The thing is that im now 37 years of age and see that this pension wont be enough to live on in years to come and I want to take out some kind of extra supplement to bring my wage up to what im getting now and taking into consideration inflation and other factors over the years the question is how or where does one go and is there a product for me out there???

Ive gone to the banks before 2004 and they said they couldnt help me as I already had a work pension on the way in the future, but its opened up now and seemingly everyone can step aboard and top up there pensions to a respectable amount of money.

Advice and tips would be appreciated my regards
 
This interesting question relating to the Defence Forces Pension Scheme was split from a general discussion concerning Public Servants and AVC's.

aj

added later
The Defence Forces Scheme is rather unique and might detract from the substantive issue being discussed in the "AVC's and Public Servants" thread. .
 
hello,
Im just so interested as to know why this subject was split from the main discussion on public servants and avcs i dont understand.

The only thing i want to know is why were in a differant position than the rest of them surely if i want to make up my own pension in a financial institution whats the big deal about it?

Can anyone give me any information as to how to set this up and whats the best place to go and get any info on pensions.
 
Hi Seanie,

I split out your question as I was concerned that you would not get answers which would relate specifically to the defence forces schemes.


2.7.4 The Defence Forces Pensions Schemes are a distinct superannuation code intended to cater for the special requirements of the Defence Forces and are quite different from the codes applicable elsewhere in the public service. Distinctive features of the code include provision for the immediate payment of pensions and gratuities regardless of age after relatively short periods of service (five years for gratuity only and 12 years for pension and gratuity in the case of officers; three years for gratuity only and 21 years for pension and gratuity in the case of enlisted personnel) and the absence of provision for the preservation of benefits.

2.7.5 Unlike most other public service superannuation codes, the Defence Forces code is generally not directly pay-related in that many of its benefits - pensions in particular - are not directly based on pay at date of retirement, but are flat rates based on rank, service in rank, and overall service. Benefits under the code are generally revised in line with movements in the pay of serving personnel.



aj
 
hi since i havent got any replies from the thread i started on pensions i ask the same question again. As i have done 21 years in the army and can leave the defence forces right now if i want with full army pension but im not going to for a nice few years yet can i start out a private pension plan for myself as nobody i ask even in the banks seems to know this i know the defence forces pension is non contributary so i want to continue serving and still put some money into a private pension plan also so that when im 65 and draw the old age contributary pension and my defence forces pension i can still have my private pension there to top up the shortfall i might have in my standard of living i would appreciate any comments on this matter as i have a few big decisions to make over the next few months regarding this matter
 
Probably not much help and I'm no expert but...here goes

Isnt there somebody in your union that could answer your questions, I'm sure they would understand the specific problems you have raised. This could be totally wrong but I wouldnt have thought you could start a private pension when you have an occupational pension?

My partner too is in the army, and I've also queried if they could top up their fund via AVC. My broker who handles my pension briefly said it may be possible (i.e when you get paid duty money etc..) but he'd have to get and read up on the terms of the army pension.

Cheers
S.
 
Not sure if this helps, but my father was an officer who took VER about 2001 I think. I know he has since put money into a private pension for the benefits of the tax treatment etc.

This would seem to suggest that there's no problem having two pensions, however given the govt is currently "saving" for your pension, I'm not sure they'd also allow you to take advantage of the tax treatment for pension contributions, as it would effectively be a double cost to them, would it not?

Agree with previous poster, get onto your union about it. Failing that, try Revenue themselves.
 
thanks for youre comments on this matter as noone seems to know anything about this subject no matter who i try at work or in the bank no one seems interested.

But all i know is that i have crucial decisions to make and would like to have an avc as a supplement to my pension i do know that if i left the army i would be able to start another pension plan with the new job but as im not leaving i want to cement and secure my future.

as so many people in the country have avcs on there income at the moment and surely in this day and age when pensions are seemingly on the top of everyones tongue surely we have responsibility for ourselves and our families to secure there future so theres no pain or drop in the standard of living any information would be appreciated thank you
 
Hi Seanie,

I empathise with your frusturation at not being able to find answers to your questions.

I suggest you do the following:


1) Write a letter to Pdfora or Raco and ask them the question. Dont worry if your not a member. If they dont respond ask a friend or colleague who is.

2)Write a letter to your local TD (or perhaps a TD in South Kildare) and ask them the question. (if neccessary the TD can always raise the question on the floor of the Dail)

3)Im not sure whether the army have HR department but if they do ask them the question.

4)Write a letter to the Department of Defence and ask them the question.

5)Seek professional independant advice from practioners familiar with army affairs. I suggest looking in the Newbridge, Curragh areas.

Good Luck and let us know the outcome.

aj

I think that this might be of interest to you.
 
seanie,

Did you ever get a satisfactory response to your very interesting question regarding PRSA's and members of the defence forces?

aj
 
Hi there. Yes I did get an answer to my question about Defence Forces pensions, but I’m not sure whether it was satisfactory or not.

I took you’re advice and then wrote a long letter to the Pensions board and as they didn’t seem to know about what went on in Defence Force Regulations they passed on the letter to (coláiste Caoimhín) the Army finance branch in Renmore in Galway.

This branch then in turn rang me on my phone and we had a good chat about pensions the only thing is there was a lot of information to take in very quickly and not sure if I understood it to its fullest effect, but this is what I understood from it.

The army finance branch told me that I could open up a pension but seeing that I was only 37 and nearly 21 years done in the service which would be pensionable by the army reckoned that I wouldn’t be able to claim tax relief on the proposed a.v.c. that I wanted to take out. In civvy street. You have to be 50 years of age to be in the receipt of a pension. i.e. (civvy pension, A.V.C.). They also told me that there was nothing in defence force regulations stopping me from starting my own pension that it was a Revenue rule. Could anyone with any knowledge on these matters be able to put me right?.

But the funny thing about this is that if I left the Army on my completion of 21 years service and in receipt of my army pension, I would be able to take up other employment and start my own pension plan with the facility of being able to claim tax relief on this proposed civvy pension scheme.

To summarise there’s something fundamentally wrong with these rules as they seem contradictory to each other where on one hand if I stay in the defence forces I can have the A.V.C. but unable to claim tax relief, but if I leave I can be in receipt of my army pension and still start up my own A.V.C. from the new civvy employment that I take up.

I hope I have explained this correctly but maybe there’s someone out there that maybe knows better than me and inform me better in layman’s terms. All answers appreciated

 
Hi Seanie, here is my tuppence worth:

  • The revenue will not allow you to claim relief on more than one pension in respect of the same employment
  • But they will allow you to have an AVC in respect of an employment - if that employment does not already have facility to allow you to make AVCs
  • It seems from what you're saying that the Army Pension does not have facility to allow you make AVCs
  • So you should be able to set-up (for example) a stand alone PRSA AVC and claim tax relief on your contributions to this PRSA
  • The advisor to your PRSA should be able to verify whether or not you can get relief on these contributions, in all likelihood you should be able to get this relief
  • I think that the Army Finance Branch reckon you can't get relief because they believe that you will be getting a "Revenue Maximum" pension from the army, but I would think that the Revenue Rules can be played to your advantage to show that there is scope for additional AVC (or civvy as you call it) funding
 
Re: AVC's for Public Servants

hello,
Ive been listening on the media for some time now about pensions and how they could benefit a person if one was on 42% tax rate well im on that rate and havent a clue where or how to start researching the subject there is so much to take in and it all seems to be in legalesse language and making not much sense to the working man.

I myself am in the defence forces for 20 years now and next year I can go out on a 21 year pension.

For me to leave next year i would get €250 (approximately) a week and if i stayed until 31 years this pension would rise to €330 a week through various increments throughout between 21 and 31 years of service.

Then at the age of 65 this 31 year pension reverts back to the 21 year rate bearing in mind that this pension is non-contributary and is indexed linked to benchmarking and other payrises. Also i would be entitled to the old age contributary pension.

The thing is that im now 37 years of age and see that this pension wont be enough to live on in years to come and I want to take out some kind of extra supplement to bring my wage up to what im getting now and taking into consideration inflation and other factors over the years the question is how or where does one go and is there a product for me out there???

Ive gone to the banks before 2004 and they said they couldnt help me as I already had a work pension on the way in the future, but its opened up now and seemingly everyone can step aboard and top up there pensions to a respectable amount of money.

Advice and tips would be appreciated my regards
 
are ex members of the defence forces entitled to full social welfare payments and go on to avail of third level education for free i have been led to believe that we are not cause are pensions are to big. my pension is the basic 21 year pension. Seanie can you advise on this as i cant get his information anywere.

thanks

Deck0
 
seanie, my advice to you if you are on 42percent i take it you are a single man to supplement your income if you have childern you can appply for a a payment called a family income supplement.
but of course around two thousand will be deducted from your gratiuty cause the widows and orphans fund is a 31 year pension fund. at 37 your not to late to start a pension planin but it would not be in addition to your army pension. you would have to start a private pension plan try nothern rock and dont be discouraged by recent events by them. and by the way if you worked 3 days a week or even 4 you would get exactly the same money your on now with the pension. and rember anymore than 300 euro a week you are liable to tax.
 
you would have to start a private pension plan try nothern rock and dont be discouraged by recent events by them.

As far as I know, Northern Rock don't sell pension products in Ireland, only deposit accounts.
 
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