Finance Bill 2023 (likely) Changes on Pensions

G

GSheehy

Registered User
Messages
1,007
The removal of the upper age of 75 on PRSAs - so whole of life PRSA.

Relaxation of transferability options on RACs/Personal Pensions - other than to another RAC or PRSA.


Gerard

www.prsa.ie
 
GSheehy said:
The removal of the upper age of 75 on PRSAs - so whole of life PRSA.
Click to expand...
Can you explain what this means and implies? You can keep the PRSA going beyond 75 without having to buy an annuity or ARF? You can keep contributing to it? Would many want/need to do this?
 
Last edited:
Anything about them closing off the unlimited employer PRSA contributions "loophole" that they opened last time around?
 
ClubMan said:
Can you explain what this means and implies? You can keep the PRSA going beyond 75 without having to buy an annuity or ARF? You can keep contributing to it? Would many want/need to do this?
Click to expand...
Would be useful if your fund was a high value and you wanted to split it into two separate PRSA and retire just one of the PRSAs. The second one would presumeably form part of your estate so useful for passing money on to the next generation.
 
Flybytheseat said:
Would be useful if your fund was a high value and you wanted to split it into two separate PRSA and retire just one of the PRSAs. The second one would presumeably form part of your estate so useful for passing money on to the next generation.
Click to expand...
My understanding is that if you have a PRSA you won't have to transfer it to an ARF "on retirement ", but rather the PRSA can continue and you draw down income from the PRSA (as if it were an ARF).
But in such case , whether you split the PRSA into two or more PRSAs you will still be required to drawdown 4%/5% pa as taxable income. I very much doubt you will be able to leave one PRSA untouched as a future inheritance.
This assumes that the potential changes GSheehy outlined are actually included in the Finance Bill.
 
They're paving the way for the day that the ARF may no longer exist as an option and the PRSA will be both a pre and post retirement product for the life of the PRSA holder. Good news for the PA and the 0.05% pa fund value fees they collect. At the monent you can mature a PRSA and stay in it as a vested PRSA, but you have to then ARF it @ 75.

You'll still have to change it from a pre to post retiement product @ 75 so the scenario that @Flybytheseat describes isn't going to happen IMHO.

My understanding on the unlimited employer PRSA contributions is that it's not changing. Well, I haven't heard otherwise as of now.


Gerard

www.prsa.ie
 
Last edited:
GSheehy said:
They're paving the way for the day that the ARF may no longer exist as an option and the PRSA will be both a pre and post retirement product for the life of the PRSA holder. Good news for the PA and the 0.05% pa fund value fees they collect. At the monent you can mature a PRSA and stay in it as a vested PRSA, but you have to then ARF it @ 75.

You'll still have to change it from a pre to post retiement product @ 75 so the scenario that @Flybytheseat describes isn't going to happen IMHO.

My understanding on the unlimited employer PRSA contributions is that it's not changing. Well, I haven't heard otherwise as of now.


Gerard

www.prsa.ie
Click to expand...
There's a crazy situation at present where a person who leaves a PRSA in place to age 75, even if it's vested and being used to provide income, they lose access to the funds and it can then only form part of their estate. Strange set up, although it does allow the wealthy a nice bit of estate planning.
 
You must log in or register to reply here.
Back
Top