There are something like 400k public service workers on DB schemes.over public sector pensions that often dwarf €2m,
They stop working in their mid-50s because they can.Why shouldn't it do both?
There is zero social benefit in GPs and entrepreneurs amongst others retiring in their mid-50s to avoid a huge tax hit if they stay working another decade.
And nobody ever gets their knickers in a twist over public sector pensions that often dwarf €2m, every cent paid for by the taxpayer.
Okay, sometimes.There are something like 400k public service workers on DB schemes.
I'd estimate something like 1% of these are on track to breach the SFT, the majority of whom are hospital consultants.
The idea that these "often" breach €2m is just not true.
You've missed my point completely.They stop working in their mid-50s because they can.
Sure we all know that.No I didn't. I do know what you mean that it can discourage valuable people to work more. But surely they are not forced to contribute further in their funds... They make a balanced choice. When I said they can, I meant that they could make that choice. Plenty could not and do not have the opportunity to stop.
1% is more like rarely than sometimes.Okay, sometimes.
Not really. And with more and more PS workers in the post-2013 SPSPS far fewer will ever get anywhere near the €2m as it's done on a career-average basis.My point stands.
Okay, I'll rephrase:1% is more like rarely than sometimes.
Not really. And with more and more PS workers in the post-2013 SPSPS far fewer will ever get anywhere near the €2m as it's done on a career-average basis.
1) What's your threshold for dwarfing €2m?that can dwarf €2m
Feel free to do your own research. Not my job.1) What's your threshold for dwarfing €2m?
2) How many PS employees are on track to breach this threshold?
A hospital consultant will breach the €2m limit on their pension. I know people won't have sympathy for them but imagine spending all of your 20's and early 30's training and being moved around the country and then abroad. In your mid 30's you get your rewards for all that hard work and get a job as a consultant, a recognised expert in your field. You are well paid for it and get a HSE DB pension. But, you will also get a massive tax bill at the end of it as your pension benefits will always exceed the allowed cap. How can you offer someone a pension scheme that will land the employee with a massive tax bill at the end?There are something like 400k public service workers on DB schemes.
I'd estimate something like 1% of these are on track to breach the SFT, the majority of whom are hospital consultants.
The idea that these "often" breach €2m is just not true.
That was the point I was making in the thread about the review of deemed disposal tax on etfs. The very fact that we have all these high taxation regimes on investments is discouraging the highly skilled professionals like consultants that our health service is struggling to attract.But, you will also get a massive tax bill at the end of it as your pension benefits will always exceed the allowed cap. How can you offer someone a pension scheme that will land the employee with a massive tax bill at the end?
1) What's your threshold for dwarfing €2m?
2) How many PS employees are on track to breach this threshold?
In this vein, bear in mind that the annual CGT exemption of €1,270 hasn't changed since well before the Euro came into circulation 21 years ago.If inflation runs at 8% for next say 9 years
The 200k tax free lump sum will only be worth 100k in today's terms
and no indexation for CGT removed in the early 2000s I think, therefore the erosion of the original capital investment by inflation is still subject to full CGT taxation on the sale of an assetIn this vein, bear in mind that the annual CGT exemption of €1,270 hasn't changed since well before the Euro came into circulation 21 years ago.
And of course the tax free roll up is an illusion.
Sorry, I was confusing it with the argument that there is an opportunity cost advantage in getting tax relief now and paying it back in retirement. There isn't; the Tax Man gets all the benefit of the opportunity cost.Hi Duke
I have been under this illusion all the time.
Is it an illusion because it's taxed anyway at the marginal rate on retirement?
Brendan
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