Pension and back to college

R

Robin

Registered User
Messages
13
Hi All,

Just a query really. I have been in my workplace for the past five years and my pension is 12%. I am planning to go back to college in September so I just want to know what happens to my pension?

Robin
 
Do you mean that your contribution (employer and employee) was 12% of your gross? If this is an occupational scheme then when you leave the job you should be given a form allowing you to choose what you want to do - (a) leave your money invested in the employer's fund (b) transfer to another occupational scheme (not relevant now I guess - you can always do this later if/when you take up pensionable employment again) (c) transfer your money to a buy out bond. Your HR department of the company's pension consultants should be able to help you out with this.
 
legend99 said:
clubman, can you confirm that you can buy out a pension after 5 years of having it?
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Do you mean transfer to a buy out bond? I'm not aware of any five year limitation on doing this and assume that you can do it any time.

Esp after this post??
http://www.askaboutmoney.com/showthread.php?t=8746
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Why that post - it makes no mention of any five year period? Transferring to a buy out bond is not the same as cashing in a pension. It is simply transferring from one pension vehicle to another. You never lay hands on the cash as such and it remains tied up until retirement.
 
You have 4 options
1. Leave it where it is until retirement age.
2. Transfer it to a Buy-out-Bond. This transfers it to your name rather than your company but you still can't touch it.
3. Transfer it to another Revenue approved pension scheme if you move to another company.
4. Cash it in. This will be your contributions only, less a chunk of tax. Not really recommended.

You will not in practice be able to move it to a PRSA (which is a situation that drives me nuts....long story).
 
D8Lady said:
You have 4 options
1. Leave it where it is until retirement age.
2. Transfer it to a Buy-out-Bond. This transfers it to your name rather than your company but you still can't touch it.
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Yes - but as far as I know you can initially choose (1) but later on change your mind and choose (2) and there is no time limit on doing the latter. This seems to be the nub of the question above.

4. Cash it in. This will be your contributions only, less a chunk of tax. Not really recommended.
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This is only possible if you have served less than two years (cumulatively if you transferred in in the first place) in the pension scheme in question.

You will not in practice be able to move it to a PRSA (which is a situation that drives me nuts....long story).
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Are you sure about that? I thought that the limitation was that anything over €4K fund value required an actuarial cert which cost and arm and a leg but the limit was recently increased to €10K making this possibly a more feasible option for some people with relatively small pension funds to transfer?
 
Correct on no. 1 & 2. There's no rush on deciding what to do.
Am not sure about the 2yr limit on cashing it in. I know I had this option when made redundant after 3 1/2 yrs in a company.

Move to PRSA- am sure about that one as of a year ago. Each indemnity cert cost €1million. If they have changed it recently, it would be helpful to some people. But I don't think would apply in Robin's case.
 
D8Lady said:
Correct on no. 1 & 2. There's no rush on deciding what to do.
Am not sure about the 2yr limit on cashing it in. I know I had this option when made redundant after 3 1/2 yrs in a company.
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Redundancy may be a different matter or this may have been when the vesting periods were longer and not more recently when the two year vesting applied.

Move to PRSA- am sure about that one as of a year ago. Each indemnity cert cost €1million. If they have changed it recently, it would be helpful to some people. But I don't think would apply in Robin's case.
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An indemnity cert was not required for a fund of €4K or less as far as I know and this was upped to €10K by the most recent Finance Act again as far as I know.
 

ok, sorry. The question i meant was to get the cash back..you cannot get the tax back less exit tax unless you have been part of the scheme(cumulatively) for less than 2 years?
 
Yes - and then you only get back your personal and AVC contributions (not also your employer contributions) and these are taxed (at 23% I think). If you had transferred in from another scheme then any vesting period served is carried in too.
 
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