Annual Contribution to PRSA

[Happy Girl]

Is it possible to open a PRSA with lodgement of annual 5k into it, write to Revenue seeking tax relief annually and for them to send cheque for 2,050 (assuming 41% tax liability). I realise PRSI relief would have to be claimed separately. This seems too simple but if it were possible would leave it easier to go with a non employer designated PRSA provider and just make annual contribution. What is the story?

 

[Guest126]

Yes it is possible to do that - but the tax refund would be received when you complete your tax return for the year - so the 2006 contribution would get a tax refund about now when you complete your tax return for 2006...

 

[Happy Girl]

Thanks Capital. Would PRSI relief also be given at the same time or would I need to apply for that separately. Any opinions on going this route. are there any advantages/disadvantages. Also if employer contributes to my PRSA could they do this on an annual basis too whereby they would give me my contribution via wages on one particular paypack?

 

[ClubMan]

Thanks Capital. Would PRSI relief also be given at the same time or would I need to apply for that separately.

You need to claim this separately.

Claiming PRSI relief on standalone PRSA contribution

Any opinions on going this route. are there any advantages/disadvantages.

Drip feeding monthly contributions might be more prudent to avail of € cost averaging.

Also if employer contributes to my PRSA could they do this on an annual basis too whereby they would give me my contribution via wages on one particular paypack?

I guess so and you would then get tax and PRSI relief at source assuming that your overall contributions are under your age related pension tax relief limit.

 

[LDFerguson]

Also if employer contributes to my PRSA could they do this on an annual basis too whereby they would give me my contribution via wages on one particular paypack?

If your employer contributes to a PRSA they will usually pay directly into the PRSA.

Your employer is under no obligation to facilitate an annual payment into a PRSA - it would be at their discretion.

Liam D. Ferguson
www.ferga.com