HSE lump sum and revenue limit

maurapat

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I work in hse part time and will have 16 years service at 60, class A, started pre 2004 I have been informed by Hse that my lump sum will be based on uprated salary as if full time.
My question is : on what figure do revenue base their assessment.. is it uprated lump sum paid or actual pensionable salary as amounts are different and affect amount of avc that I might contribute? Thanks in advance
 
For the purposes of the superannuation scheme, part-time service accrues part years. So if you're working 50% hours it'll take you two years to accrue a year's service at full-time salary.
 
Yes, my service at 60 will be 32 years part time/16 full time.
It is the salary part of the equation that I’m confused about in revenue calculation
ie what salary in the equation
Salary * 81/80 for 16 years service?
I assumed it was my actual salary for part time hours but it appears this number is up rated for hse to full time equivalent. Does revenue use same Hse uprated salary?
I’m unsure how much avc I could contribute ? Wondering if anyone has an experience of this.
 
You are permanent part time. For Revenue purposes you have worked for 32 years and your maximum yearly remuneration is determined using one of the definitions below.
Because you have worked in excess of 20 years Revenue allow 120/80 of this maximum remuneration as your allowable tax free lump sum.

Don't rely on the HSE to calculate your maximum allowable remuneration.
You might have to seek salary details from them for up to 10 years prior to your retirement date and do the calculation yourself.

Send the pay details which produce the maximum remuneration and your employment starting and ceasing dates to your AVC provider and they will determine your extra tax free lump sum.

Will you have 2080 class A prsi contributions when you retire at age 60 ?



Remuneration can be defined as total of basic pay plus overtime payments, bonuses, commissions, fees, etc. assessed to tax under the PAYE system (i.e. Schedule E), including the value of any benefit-in-kind. In determining “Final Remuneration” for maximum allowable benefits purposes, the Revenue will allow the use of any one of three different definitions, provided you are not a ‘20% Director’ (in which case Definition 2 must be used).

Definition 1.
Basic salary over any twelve month period in the five years before retirement, plus
the average of any fluctuating emoluments (commission, bonuses, benefit-in-kind, etc.), over three or more consecutive years, ending on the last day of the twelve month period chosen.

Definition 2.
The average of total emoluments (income taxed under Schedule E) for any
three or more consecutive years, ending not earlier than ten years before retirement.

Definition 3.
The rate of basic pay at retirement, or at any date within the year ending on the
retirement date, plus the average of any fluctuating emoluments (commission, bonuses, benefit-in-kind, etc.) over three or more consecutive years, ending on the day used to determine
 
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Hi,
I am considering early retirement from the HSE. Class D PRSI. I have AVCs. I have had a look at the Retirement Form online, Form 107 (a).
Page 5 asks if I have a certificate from the Revenue Commissioners stating my Personal Fund Threshold (PFT).

How will my pension be affected by my AVC’s?
I don’t know what my pension will be as I never received an estimate from the superannuation department despite applying earlier this year with a date for August 2024 as potential retirement date. Date now gone…
If I don’t know what my pension or lump sum will be how can I apply for a PFT, or does HSE apply for that?

I really want to understand all of this before I apply.

Thank You in advance.
 
The HSE has an abominable reputation for failing to provide superannuation numbers to staff. If it happened in the private sector there would be appeals to the Pensions Ombudsman.
Bur ironically, public sector organisations seem to be exempt from the regulations which apply to private sector organisations.
There is no excuse for such maladministration.
 
I don’t know what my pension or lump sum will be how can I apply for a PFT, or does HSE apply for that?

A PFT has to be claimed by an individual (not the HSE) by way of notification to, and certification by, the Revenue Commissioners.

In order to make a PFT notification to Revenue, you will be required to request and obtain from the pension administrator of your pension scheme, a statement certifying, among other things, the amount of your pension entitlements on 1 January 2014 relating to that arrangement,
including the annual amount of pension and lump sum accrued up to that date. If you also had any private pensions/AVCs as at that date, you need to also get confirmation of the values as at 1 Jan 2014 and submit these values along with the certificate from the HSE to Revenue.

If you are entitled to Professional Added Years (PAYs), this will also factor into the calculation of the PFT.

As regards your pension or lump sum, if you are willing to provide more details as regarding your service and salary, you might be able to get a steer here on AAM.

If the capital value of your pension benefits are in the territory of exceeding the Standard Fund Threshold (€2m) where Chargeable Excess Tax is going to be a liability for you, you would be best advised to seek professional advice as to your options in how to deal with this tax (and also help with a 'look-back' PFT submission to Revenue).
 
Thank you for your detailed reply. I only have a HSE pension.
I will do some researching in order to calculate a ballpark estimate as to what my pension would have been on 01 Jan 2014. I see that I will need this figure confirmed by the Superannuation Department anyway.

There are no PAY's for my grade unfortunately.

I did not have any PRSA AVC's on 01 Jan 2014 having only started it in 2017 for the previous 2016 Tax Year.

My own back of an envelope calculation for my current pension (may be higher or lower, not sure of exact service as I worked part time some weeks for a period)
would be approx €32K pension and Lump Sum €111K. Taking a hit for actuarially reduced pension.

Is there a 'factor' that a public service pension is multiplied by to reach a capital value for that pension?

Thank You in advance.
 
Thank you for your detailed reply. I only have a HSE pension.
I will do some researching in order to calculate a ballpark estimate as to what my pension would have been on 01 Jan 2014. I see that I will need this figure confirmed by the Superannuation Department anyway.

There are no PAY's for my grade unfortunately.

I did not have any PRSA AVC's on 01 Jan 2014 having only started it in 2017 for the previous 2016 Tax Year.

My own back of an envelope calculation for my current pension (may be higher or lower, not sure of exact service as I worked part time some weeks for a period)
would be approx €32K pension and Lump Sum €111K. Taking a hit for actuarially reduced pension.

Is there a 'factor' that a public service pension is multiplied by to reach a capital value for that pension?

Thank You in advance.
Based on the above estimates, your total benefit package value will be way short of the €2.15m effective fund cap. The multiplier to value the pension can vary depending on the retirement age, but 30:1 is a reasonable estimate. That would result in a capital value of c€1.07m.
 
Based on the above estimates, your total benefit package value will be way short of the €2.15m effective fund cap. The multiplier to value the pension can vary depending on the retirement age, but 30:1 is a reasonable estimate. That would result in a capital value of c€1.07m.
Thank You Conan,
No not in the big league..
Regards,
Mr. Black
 
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