Baby boomer
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The point has been made elsewhere that the employee 6% is taken from gross Income without tax relief. But worse still, it's taxed on the way out! The employee contribution of 6% is fully taxed (plus PRSI USC) when it's earned. Then when it comes out of the AE it's taxed again. So 6% becomes 8% when the government top-up is included. But a standard rate taxpayer gives up 1.6% in tax leaving a mere 0.4% nett contribution by the state.
It's even worse for a higher rate taxpayer pensioner. The 6% becomes 8% but tax takes 3.2% leaving a mere 4.8% for the pensioner out of their original contribution.
This is a dreadful deal and a basic PRSA would be a better option. (Employer contribution and investment performance being equal.)
Or am I missing something?
It's even worse for a higher rate taxpayer pensioner. The 6% becomes 8% but tax takes 3.2% leaving a mere 4.8% for the pensioner out of their original contribution.
This is a dreadful deal and a basic PRSA would be a better option. (Employer contribution and investment performance being equal.)
Or am I missing something?
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