Once off pension contribution for 62 yr old

[beekeeper]

Hi

My Dad is self-employed, aged 62 and has been advised to pay a once off pension contribution for tax reasons. The amount will be circa E30K. He has been advised that 1) if he invests this as a once off payment it can be tax effecient and 2) he will have immediate acces to the funds because of his age. While 1) is obvious is am no sure about the truth of 2).

Can someone please advise if this is the case and also we are looking for the best way to invest this assuming because of his age we wish to remain in cash.

Cheers

 

[mercman]

I am no expert in Pensions, but depending on the product and how it is been sold a large chunk of the investment amount will be paid in commission. Furthermore the structure of most pension products are equity based and we ahve all heard about the equity markets of recent. Has he asked a proper accountant of other ways to offset his Tax liability.

 

[Hen]

why not go with what Hibernian are offering at the moment ecb rate + 1%, ring them up and find out if you take it out when can you cash it in

 

[LDFerguson]

Hi

My Dad is self-employed, aged 62 and has been advised to pay a once off pension contribution for tax reasons. The amount will be circa E30K. He has been advised that 1) if he invests this as a once off payment it can be tax effecient and 2) he will have immediate acces to the funds because of his age. While 1) is obvious is am no sure about the truth of 2).

Can someone please advise if this is the case and also we are looking for the best way to invest this assuming because of his age we wish to remain in cash.

Cheers

Two very good replies so far - be very aware of charges (including possible early exit penalties) before he signs on the dotted line and investigate some of the newer deposit fund options.

Hard to say for certain without knowing his circumstances, but in general, pension contributions do qualify for tax relief and are tax-efficient.

On the second point, he is old enough to draw his pension immediately, although he may not be able to access all the funds straight away and some of the proceeds might or might not be taxable. A lot will depend on what other income and pension funds he has, whether he's a sole trader or a company director etc.

 

[williammor]

Two very good replies so far - be very aware of charges (including possible early exit penalties) before he signs on the dotted line and investigate some of the newer deposit fund options.

Hard to say for certain without knowing his circumstances, but in general, pension contributions do qualify for tax relief and are tax-efficient.

On the second point, he is old enough to draw his pension immediately, although he may not be able to access all the funds straight away and some of the proceeds might or might not be taxable. A lot will depend on what other income and pension funds he has, whether he's a sole trader or a company director etc.

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