How to maximise tax relief on pension

S

Slats362

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My husband received a redundancy package in 2013.He availed of his tax free lump sum at that time and waived his right to this at retirement(around 80k)He is now approaching retirement and has an AVC fund of approx 66k and a separate pension bond from a previous employment of 24k.How can he maximise the amount he can take tax free from AVC and Pension Bond?
Thanks for any help .
 
Slats362 said:
He availed of his tax free lump sum at that time and waived his right to this at retirement(around 80k)
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Why would you think you can take a tax free amount now when you have stated you waived the right to do so, by receiving redundancy using the tax free allowance already?

If perhaps you are not referring to an addtnl lump sum and instead mean by way of drawing down - you would need to provide a bit more info on full sources of potential income (state benefits, rental inc etc).

I would expect that given the amounts mentioned above, income tax would be minimal if at all on the annual 4% drawdown of the above funds on top of state savings
 
He waived his right to the tax free lump sum of his pension related to that employment, not future or previous employment.

If he still has that pension in an occupational pension, he can transfer it to a PRSA and avail of the tax free lump sum, even though he waived his right to it under his redundancy package. If he transferred it to another occupational pension, the same applies. If it went to a buy out bond, you can't.
Steven
www.bluewaterfp.ie
 
Ah right, ok I never looked into these options. Kinda makes a mockery of the "waiving the right" wording, if you can just shift it around to a different vehicle and gain the right back. If I am lucky enough to get redundancy I must bear in mind.

Assume OP has income covered already and hence makes sense to take as much from these as TFLS.
 
He waived his right to future tax free lump sum from his defined benefit pension.He will receive a deferred pension from this pension.His AVC is linked to the defined benefit pension .
Does that preclude him from taking a tax free lump sum from both his AVC and Pension Bond ?
He will be entitled to a state contributory pension.No rental income.
 
Just to say Pension Bond from previous employment,in 1980’s.
No pension benefit in current employment other than PRSI contributions
 
Slats362 said:
He waived his right to future tax free lump sum from his defined benefit pension.He will receive a deferred pension from this pension.His AVC is linked to the defined benefit pension .
Does that preclude him from taking a tax free lump sum from both his AVC and Pension Bond ?
He will be entitled to a state contributory pension.No rental income.
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You were never entitled to two lump sums from the main scheme and from the AVC plan, they are to be viewed as one so he has waived his lump sum to that pension.

His is entitled to a lump sum from the pension bond if it is from a different employment.


50andOut said:
Ah right, ok I never looked into these options. Kinda makes a mockery of the "waiving the right" wording, if you can just shift it around to a different vehicle and gain the right back. If I am lucky enough to get redundancy I must bear in mind.

Assume OP has income covered already and hence makes sense to take as much from these as TFLS.
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It's a loop hole that may be shut off by the Revenue in the future. Not many people know about it so it isn't used all the time.


Steven
www.bluewaterfp.ie
 
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