I take this to mean that currently you are assigning costs to the business operations that lets say are a bit of a reach and not wholly consumed by the pure play actual carrying on of the business......stripped of these costs you could declare higher profit.
My understanding on this - is that companies were previously constrained by age and income related thresholds in terms of how much they could legally contribute into an individual's PRSA and not trigger BIK problems.
The removal of annual pension funding on the employer side means that @businessman's company can make very large contributions to his PRSA regardless of his age or how much his salary is......this is very advantageous if you think about it.....on first glance the tax relief is 12.5% on this contribution as the company reports a lower profit on higher operating expenses....but on second glance you realize that as a single member LTD business owner taking a distribution of these profits...as either higher wages or dividend distributions triggers even higher marginal tax leakage.....so the best tax deferred route for these monies (if a business owner doesn't need the income now per se) is to load up their PRSA optimizing for the standard fund threshold.
I havent dug into the legislation but it appears that unlike other jurisdictions....the Irish change doesn't seem to enshrine some kind of labor market wage test....forcing monies to be paid via salary first...as I know in other countries this type of arrangement is constrained by the business owner first paying themselves a defensible and labor market tested salary for his/her services provided to the LTD and the same for family members 'working' in the business.
Without doing too much digging.....and can be corrected here from those who watch these things more closely......but on first blush the new revised rules look like a wonderful way for those that are already income rich to legally avoid and defer taxes out into the future using a PRSA shield......first by channelling various income streams into a limited liability company...for which they and their family are employees on very low wages but very very high employer pension benefits.