Employer Contributions to PRSA
In the
2022 Finance Act, the Benefits in kind (BIK) charge on employer contributions was removed. This allowed employers to make large contributions to Personal Retirement Savings Accounts (PRSAs) without the same funding restrictions that applied to traditional occupational schemes.
This was a hugely beneficial change for company directors and key employees to make significant contributions to their pension fund. It seemed too good to be true, and it looks like that is the case, as Revenue is
believed to be actively reviewing it. We therefore expect that there will be changes to this to closely align it with traditional occupational schemes.
Where’s the opportunity, you ask? Well, if you have a business then you should look to take advantage of this prior to the end of 2024 and make contributions where the cashflow in the business allows.
While many will be dealing with rising costs and inflation, it is so important to plan for your retirement and a key part of succession planning is ensuring you have adequate funds to replace your income post-working life.