PRSA - Can I access at 50?

S

suemoo

Registered User
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Hi all,

Im looking for some advice. Is it possible to access my PRSA at the age of 50? I am currently 40 years of age and I have a fixed income for life due to the death of my husband whom had a civil service job so finanically im good. could anyone shed some light on this for me? Thank you for your help, Sue
 
SBarrett said:
If it is a work related PRSA, you can. This includes PRSA's set up through your employer even if they don't contribute.
If it is solely personal, you can't.


Steven
www.bluewaterfp.ie
Click to expand...
Can you clarify what this means for someone who took out a PRSA privately to supplement their PS pension but have now opted for cost neutral early retirement at 56? Is there any impediment to them taking out the 25% lump sum?
 
Is this an AVC scheme to supplement their main scheme defined benefit pension? If so in this case, the retirement of the AVC is done at the same time as accessing benefits from the main scheme. A max lump sum is calculated at retirement based on salary and service at that time. If this max figure is more than the lump sum paid from the main scheme then the balance can be paid from the AVC scheme. If not, there is no lump sum from the AVC scheme and AVC gets transferred to an ARF.
 
Slim said:
Can you clarify what this means for someone who took out a PRSA privately to supplement their PS pension but have now opted for cost neutral early retirement at 56? Is there any impediment to them taking out the 25% lump sum?
Click to expand...

You took out a PRSA AVC which is linked to your employment. You must mature it at the same time as you retire. As it is linked to your employment, it falls under the PS pension scheme rules. It can be accessed from age 50 but not on it's own, only as part of the scheme.

You are not eligible for the 25% tax free lump sum option. Your lump sum is based on 3/80th of salary for each year service.


Steven
www.bluewaterfp.ie
 
SBarrett said:
You took out a PRSA AVC which is linked to your employment. You must mature it at the same time as you retire. As it is linked to your employment, it falls under the PS pension scheme rules. It can be accessed from age 50 but not on it's own, only as part of the scheme.

You are not eligible for the 25% tax free lump sum option. Your lump sum is based on 3/80th of salary for each year service.


Steven
www.bluewaterfp.ie
Click to expand...
Thanks for the reassurance. In relation to the lump sum, I understood that up to 25% can be taken to top up the scheme lump sum, pro rata to actual service. Does that make sense?
 
Tax free lump sums for public service pensions are based on a percentage of final salary (or career average for new members) calculation and doesn't use the 25% of fund value method. The lump sum payable can be increased if there is a difference between pensionable salary and actual salary e.g. overtime. If there is, the difference can be taken directly from the AVC fund and the amount isn't capped to 25% of the value of the AVC fund, it can be the whole value of the AVC fund if the figures are right.


Steven
www.bluewaterfp.ie
 
SBarrett said:
Tax free lump sums for public service pensions are based on a percentage of final salary (or career average for new members) calculation and doesn't use the 25% of fund value method. The lump sum payable can be increased if there is a difference between pensionable salary and actual salary e.g. overtime. If there is, the difference can be taken directly from the AVC fund and the amount isn't capped to 25% of the value of the AVC fund, it can be the whole value of the AVC fund if the figures are right.
Steven
www.bluewaterfp.ie
Click to expand...

It can also be used to top up the tax free lump sum to the Revenue allowed maximum.

Normally the lump sum for someone with full 40 year service is 120/80 of pensionable salary. But if the retiring peron has only 20 years service the Occupational Pension lump sum is 60/80. However, the Revenue would allow the 120/80 figure once a minimum of 20 years has been served. In this scenario the retiree could top up their tax free lump by another 60/80 from the AVC.

(Just to note: The Revenue max is reduced in the case of Cost Neutral early Retirement)
 
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