AVC maximum contributions allowable.

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peggy14

Registered User
Messages
31
I am 54 so currently max contribution that I would receive tax relief on for my pension contribution is 30% of Income increasing to 35% at age 55.

My question is can I contribute more than 30% and just not get tax relief on this amount or is 30% the maximum contribution allowable to pension.
 
peggy14 said:
My question is can I contribute more than 30% and just not get tax relief on this amount or is 30%
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Yes, but bear in mind that drawdowns from your pension are taxable even if you received no tax-relief on the contribution.

It rarely, if ever, makes sense to contribute beyond the age-related limits.
 
Any contribution above the 30% can be carried forward to future years when the limits go to 35% and 40%.
 
Sarenco said:
Yes, but bear in mind that drawdowns from your pension are taxable even if you received no tax-relief on the contribution.

It rarely, if ever, makes sense to contribute beyond the age-related limits.
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Thank you. It's not for tax or pension purposes. I am going to avail of Carers Benefit Leave for c 1.5 years and reduce hours to 2 days per week which is allowable by DSP once earnings are under 350 net pw, and while I calculate by net earning are just under this figure I would rather contribute further to pension to ensure I am well under the limit (in case a nominal salary increases etc) as a cent would have major effect......it is not an option for me work less hours as 14.8 hours pw is the lowest my employer will go.
 
Conan said:
Any contribution above the 30% can be carried forward to future years when the limits go to 35% and 40%.
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thank you it would not be a substantial amount as I am taking carers benefit leave for c 1.5 years and reducing my hours to 2 days per week and need to ensure my net weekly income is within DSP limits...... I am within the limit but just wanted to make extra sure by making a very modest additional contribution to my AVC.
 
I have been doing this for about 2 years. I will
Likely retire from career job, within the next 2 years, so wanted to top up my pot. I have a number / target in mind, and i was a little short of that.
But only a little over the age related limit. I agree it doesent really make sense, in almost any situation, but for me, i wanted to get to my target- larger pot number, for my long term future, so its a short term, means to an end.

I won’t be able to carry this forward, as, post retirement, will only be drawing about 17k p.a. from ARF. Have savings and lump sum to keep me going, for many years ,so won’t be paying any PAYE anyway, as anything under €17,750 p.a. there is no PAYE due.
 
fayf said:
I won’t be able to carry this forward, as, post retirement, will only be drawing about 17k p.a. from ARF.....................so won’t be paying any PAYE anyway, as anything under €17,750 p.a. there is no PAYE due.
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But you will be paying USC and PRSI on it ............ again.
 
There’s certainly no harm in contributing to a pension over the age-related limits if the taxable ARF drawdowns will ultimately be less than €13k pa and you’re over 66 at the time of the drawdown (so that USC and PRSI are not applicable).
 
Early Riser said:
But you will be paying USC and PRSI on it ............ again.
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I will. USC is €175 annually if drawing €17,750, so its not much.

PRSI is €710 annually on €17,750,
Overall these 2 deductions are just under 5%, which is very low.

PRSI part will maintain class S PRSI contributions and as this mean, full PRSI contributions, for contributory State Pension, so its a - must do scenario. Allthough one could draw less, keeping PRSI at a €500 mimimum for state Pension, but all your doing, is putting off taxable income, once state pension kicks in.
 
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