Thanks a million Conan. Don't think I need worry about the 200,000 limit as its unlikely I'll reach it. Was just using the 100,000 figure for ease of calculations.Foxirl
Your numbers are correct. A couple of points:
- Maximising your tax -free lump sum is the most tax-effective investment strategy. You get tax relief at 40% on the contributions, the fund grows tax-free and you get the lump sum back tax-free (subject to the then rules).
- contributing more via AVCs will result in the excess AVC fund having to be used either to buy an Annuity or invested into an ARF. This will result in an additional pension income (on top of your Public Sector Pension) and such will be taxable (currently at 40% + USC).
- if you build up a self-employed PRSA, yes you can 25% as a retirement lump sum. But in total (between both schemes) the max tax-free is currently €200,000. Any excess over €200,000 is taxable at 20% (up to a total of €500,000). These limits may well increase over the next 24 years, but who knows.
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