Personal retirement bond and tax

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Pixie50

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Hi
I have a Prb with Irish life it's just under 25k and I am thinking of cashing it in at 5O . Am I liable to pay tax on the full amount .does anyone know.

Thanks in advance
 
I think you can take 25% tax free and encash the balance at 10% tax (under triviality rules).
 
Are you sure you can cash it in?

Two methods of availing of the trivial pension rules. One is where the pension would be less than €330 per year. At 50 a fund of €18,750 (after withdrawing the 25% lump sum) would give you a bigger pension than this. The other method is if ALL your pension funds (including other ones from other employments) have a value of less than €30,000. Would this be your situation?

If you're eligible for the €30,000 trivial rule, then the first 25% of your fund is tax-free and the other 75% is taxed as income, so normal tax, PRSI and USC will apply and the rates will depend on your other income in the tax year.

With a PRB there's an alternative method of calculating your tax-free lump sum, based on your salary and service in the job from where it accumulated. Occasionally this calculation can result in a figure that's greater than 25% of the fund, even up to 100% of the fund in rare circumstances. Your advisor should run this calculation for you before you make up your mind which option to choose.
 
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If you don’t need the money, i’d leave it where it is, as its presumably growing, has low ongoing costs, and unless you have a specific purpose in mind, its just going to be sitting in a bank account, losing value overtime, with inflation, and possibly bank charges as well.

I understand its also an option, to transfer a PRB into an occupational scheme, which may have even lower ongoing charges.
 
you could check the salary service lump sum to see would that give you a better lump sum.

Would a pension annuity for a 50 year old be greater than circa 2%?
 
moneymakeover said:
Can you cash in entire amount or just 25%?
Click to expand...
Hi
I can cash in 25% tax free the remaining 75% i am unsure if i can cash it in and pay the tax on it.. i do have a public sector pension i pay into and have 18 years service to date. looking for any advice anyone can offer thanks in advance
 
Pixie50 said:
Hi
I can cash in 25% tax free the remaining 75% i am unsure if i can cash it in and pay the tax on it.. i do have a public sector pension i pay into and have 18 years service to date. looking for any advice anyone can offer thanks in advance
Click to expand...

I don't think you'll be allowed to cash in the remaining 75% in one go, under trivial pension rules. See my post #5 above.

You'll need to ask your broker or whoever set up the PRB for you to calculate if you can get more than 25% out as a tax-free lump sum, using a calculation involving your salary and service in the job that generated the PRB fund.
 
Dave Vanian said:
I don't think you'll be allowed to cash in the remaining 75% in one go, under trivial pension rules. See my post #5 a

You'll need to ask your broker or whoever set up the PRB for you to calculate if you can get more than 25% out as a tax-free lump sum, using a calculation involving your salary and service in the job that generated the PRB fund.
Click to expand...
 
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