Max TFLS on low funded OPS?

F

FranMoran

Guest
Hi

Just looking into something for friend nearing retirement. He is part of a DC scheme with his employer and has a fairly low maturing value of €24k. After the initial tax free lump sum, the annuity would hardly be worth purchasing. He claims his wife was in a similar position when she came to retirement and managed to get 100% tax free lump sum. I can't see how it's possible but the maturing values are so low in these cases that I've not come across it before. Can anyone shed some light?

Cheers

Fran
 
The maximum tax free lump sum on an occupational pension scheme could be 1.5 times final salary so he could get the entire fund tax free.
Its calculated as 3/80 x no of years employed to a max of 120/80.

However if its a personal pension or PRSA maximum lump sum is 25% of the fund. The balance buys an annuity or is in vested in an AMRF.
 
Good stuff. Completely forgot that.

I'll inquire further with him about it.

Cheers

Fran
 
Quick add on query on this. What is the final salary calculated as?

Is it the last full year's salary/average of last three years etc...

Thanks
 
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