# The ultimate pension freedom: Retire in Portugal and reduce your tax



## letitroll (4 Jul 2016)

http://www.telegraph.co.uk/finance/...m-Retire-in-Portugal-and-reduce-your-tax.html

Above is focused at UK residents -

Any freedom for Irish pensioners to chase the sun and tax savings? 

The article also draws the distinction between private sector pensioners and public sector one's ? Same difference apply in the Irish context?


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## Merowig (4 Jul 2016)

You can transfer your PRSA to a pension vehicle of any EU country and you don't need to remain resident of Ireland for taxpurposes either.

So yes you can enjoy the sun


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## letitroll (4 Jul 2016)

Nice! PRSA all the way!

Anyone have any ideas on public sector pensions


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## Merowig (5 Jul 2016)

Afaik the pension can be payed also to a bank account abroad.

Transferring a PRSA abroad would make mostly only sense in case a levy would be reintroduced, as the PRSA itself can also pay your pension to a bank account abroad.
Residency determines your tax status.


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## Slim (5 Jul 2016)

As far as I know, Revenue here have a 3 year clawback so after you become resident in Portugal, they continue to tax you here. Other posters have claimed here that Irish teachers can and have availed of this but I do not think Irish public sector workers can.


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## Merowig (5 Jul 2016)

That sounds then like a question for Citizeninformation or Revenue


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## Brendan Burgess (5 Jul 2016)

I don't know enough about this to know if it works or not.  Only do it if a reputable and authorised  Irish firm of pension consultants agrees that it is above board. 

There are many scammers out there trying to liberate people from their pension pots. And the lure of saving so much tax is enough to make greedy people stupid. 

*How to avoid a pension scam*


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## 52andout (5 Jul 2016)

Not sure you can get drawdowns from arfs in Ireland paye tax free if you live abroad as revdbue wont issue Certs. Revenue do only for annuity I believe  (where you live abroad ).
Afaik


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## Merowig (5 Jul 2016)

Transfering your Irish private pension pot to another private pension vehicle abroad is pending approvals and is regulated by Revenue.

Bona fide reasons only
_“for bona fide reasons and is not primarily for the purpose of circumventing pension tax legislation and Revenue rules."
[broken link removed]
_

Though you don't need to be necessarily resident or be employed abroad (for transferring a PRSA only - for transferring an Occupational Pension Scheme afaik you need to have a job abroad) but you have to sign the bona fide declaration.
Yes in some jurisdication you might access the money earlier (or the lump sum is higher) - and so you can blow more of it away.
With freedom comes responsibility.

http://www.arrivapensions.com/~/media/Files/A/Arriva-Pensions/images/scorpion.jpg?h=255&w=380

But I don't see necessarily the connection here as also someone who recieves his lump sum in Ireland might blow it away.

_
_
http://ec.europa.eu/finance/pensions/iorp/index_en.htm


> Occupational pension funds in the EU benefit from the principles of free movement of capital and free provision of services. This means, for example, that:
> 
> 
> pension funds can manage occupational pension schemes for companies established in another EU country
> ...


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## mtk (26 Sep 2016)

Anyone on here done this ie
moved it abroad
Accessed more of it tax free
Or
Took up residence abroad and availed of favourable tax treatment afforded incoming retirees ( which Portugal appears to offer ?)


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## noproblem (26 Sep 2016)

I did know a person a few years ago who went to live in Cyprus (southern part) and he told me he was paying tax at 5% on his retired National School teacher pension, he had been a headmaster (principal). He has since passed away and his wife still lives over there, she was also a retired teacher. I never paid much heed to it at the time but can now see how attractive it was. That's all I know on this and am no longer really in touch with his wife.


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## 52andout (4 Apr 2018)

Bumping to see if Anyone on Aam has done this ?


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## Slim (4 Apr 2018)

52andout said:


> Bumping to see if Anyone on Aam has done this ?



My friend has done it and lives in Portugal. He had 3 year period during which Revenue taxed him at Irish rates but as he was/is resident in Portugal, he is now tax free in Portugal for 7 more years. He was private sector, private pension holder.


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## 52andout (4 Apr 2018)

Slim said:


> My friend has done it and lives in Portugal. He had 3 year period during which Revenue taxed him at Irish rates but as he was/is resident in Portugal, he is now tax free in Portugal for 7 more years. He was private sector, private pension holder.



Thanks slim  i would guess the 3 years has to do with period needed to lose tax residency?


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## Gordon Gekko (4 Apr 2018)

You cannot withdraw money from an ARF tax-free unfortunately.


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## mtk (4 Apr 2018)

Gordon Gekko said:


> You cannot withdraw money from an ARF tax-free unfortunately.



yes very unfair. Wonder could you move arf over there or elsewhere or not possible?


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## Steven Barrett (4 Apr 2018)

mtk said:


> yes very unfair. Wonder could you move arf over there or elsewhere or not possible?



An ARF is an Irish retirement product. Not sure if it's possible to move it to another country. Only seen transfers done pre retirement. And to further muddy the waters, the Revenue published an E Briefing in December. 

A copy & pasted summary:



> ARF distributions are subject to PAYE. However Revenue to date provided tax refunds to non resident ARF holders who could demonstrate that the ARF distribution had been taxed in their country of residence.
> 
> Revenue will not provide any further tax refunds on this basis to non residents post 22nd December 2017; instead the QFM will have to split the distribution between income, gains and capital, and for income and gains, identify when they arose to the ARF.
> 
> ...




Steven 
www.bluewaterfp.ie


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## mtk (4 Apr 2018)

SBarrett said:


> Only seen transfers done pre retirement



interesting so Sean it can be done pre retirement ? from a dc scheme?


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## noproblem (4 Apr 2018)

I know a few friends who spend most of their time in Cyprus. I should say, in the southern part as the Northern part is occupied by Turkey. It's a really lovely place, part of the EU, lovely beaches, small towns, villages, great ex pat community of mostly English people, very hot from end June until mid Sept. Didn't check it out with them properly but I think income tax for over 65's is only 5% after a generous allowance has been surpassed. I've no doubt that in near future years the Irish will retire abroad a lot more than at present. The Brits have been doing it for a long time. Only for our grandkids we would seriously consider it, still in the head though.


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## Steven Barrett (9 Apr 2018)

mtk said:


> interesting so Sean it can be done pre retirement ? from a dc scheme?



I've only seen it done from a PRSA.


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## Poseidon (10 Apr 2018)

SBarrett said:


> I've only seen it done from a PRSA.



A recent Sunday Business Post article, in the wake of the O'Sullivan v Canada Life court ruling, indicated that Revenue can demand that PAYE tax is paid on the PRSA fund balance prior to transfer abroad. Certainly the legislation on PRSAs seems to allow for this irrespective of the residence of the beneficiary. If so, it would make transferring a PRSA abroad most unattractive I would imagine.

Perhaps someone with experience of such transfers can comment?


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