Non residents - risk of no ARF option

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BingCrosby

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I've an Irish DC pension, but no longer live in Ireland (USA). I believe the below may apply to anyone non-resident when it comes time to purchase ARF.

I've recently learned from a PWC article (cannot link it here - search "PWC ARF non resident") that the revenue has suggested onerous ARF reporting requirements for non-residents.

The net might be that non residents may have no ARF option at retirement. I'm not certain and I'm not a tax expert.

Has anyone else looked into this? I can see so many problems with this scenario that it seems untenable in the long term (friction for international mobile employees, problems for retirees who move abroad after getting their ARF etc.).

Thoughts or insights very welcome.

It looks like this is the situation for some time (since 2020) so if there is a link to a previous thread, apologies, please share.

B
 
BingCrosby said:
Yes - thanks (wouldn't let me add the link to my original post for some reason).
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@Gordon Gekko - Yes that seems the most likely situation - non-Irish resident folks stuck with non-existent or very expensive ARF's. Has anyone found themselves in this situation ? Its quite possible people are using an Irish address to purchase ARF's while living in the US and taking their chances - I am not recommending that so I'm trying to see if there is any wisdom/experience on this already.
 
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BingCrosby said:
@Gordon Gekko - Yes that seems the most likely situation - non-Irish resident folks stuck with non-existent or very expensive ARF's. Has anyone found themselves in this situation ? Its quite possible people are using an Irish address to purchase ARF's while living in the US and taking their chances - I am not recommending that so I'm trying to see if there is any wisdom/experience on this already.
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That is the case. You have to have an Irish address.

I have heard that an insurance company will not close down your ARF if they subsequently find out that you are not living in Ireland.

But you will have to keep an Irish bank account as they will only make payments to an account with an IBAN number, so they will not make payments to a US bank account. The US will also tax you on your lump sum payment.


This is just an Irish issue. If you have a UK pension, you can't use the pension draw down facility (their version of an ARF) if you don't have a UK address. You are limited to an annuity.

Cashing in your pension is another option.

Like with a lot of things, the US and EU ways of doing things are completely incompatible
 
I think you'll find that different providers have different rules/interpretations on whether they'll mature their pension to an ARF for a non-resident.

Might a work-around be to trasnsfer your pension to a PRSA before you leave these shores and then vest it?

If you had a convertible term policy here, left and moved abroad, the provider is still contractually obliged to convert the policy even though they're technically selling it to a non-resident.

There's full Anti-Money Laundering on ARFs so that means certified ID , certified proofs of address and IBAN.

Haven't dealt with someone in this situation yet so haven't had the need to research it too much. It would probably be prudent to check the rules/interpretation of the provider that the pension is with in respect on non-residency before you leave the Country, just in case Company A says 'No ARF at all for non-resident' and Company B says 'Yeah, we'll do it but not for transfers from other providers'.

But, the legislation/rules may change again by the time you reach the maturity date.


Gerard

www.prsa.ie
 
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