Paul O Mahoney
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It's the only one, the rental properties are joint names and rent in her name as I didn't know if I'd be around, its saved everymonth less maintenance etc and tax by DD in November.Hi Paul,
Is this the only pension that you have?
It'd be useful to get an idea of your overall finances. For example, are you using up your full lower rate tax band already? I'm assuming not if the rent is in joint names.
You could potentially 'retire' the pension, take 25% of it tax free now, and drawdown an income from it, particularly if you can do it effectively tax free.
It might be worth getting a bit of tax advice on the most efficient way to structure this. You have your own tax band to use up, even when you retire, so there's no point paying higher rate tax on rental income in her name if it could be at lower rate in yours.It's the only one, the rental properties are joint names and rent in her name as I didn't know if I'd be around
Thanks really appreciate it we probably need to get proper advise on a slew of stuff anyway and do wills.It might be worth getting a bit of tax advice on the most efficient way to structure this. You have your own tax band to use up, even when you retire, so there's no point paying higher rate tax on rental income in her name if it could be at lower rate in yours.
I hope I'm making sense?
Re the pension, without being too morbid, another option is to leave it untouched, and it'd act as a small life assurance lump sum for your wife if anything was to happen to you.
It all depends on your overall circumstances and what you want to enjoy. It's not always about maximising your financial wealth.
Hi Paul,I have no paye taxable income , no social welfare , other than rental income which is in joint names and taxed accordingly via Form 11.
I'm 54 and probably won't work for money again as I'm a cancer survivor and some of my faculties don't function properly.
Funny you should mention that as I was filing stuff and in 2012 I had to go into Pearce St, to justify my sickness benefit and they were satisfied I was still being treated for my cancer and said that they would be recommending that I be put foward for a some kind of pension. I did nothing about it as I was still on illness benefit and assumed it would naturally follow.Hi Paul,
I followed RedOnion's link to this thread from the tax query you posted today. I note from the other thread that you have kept up your PRSI contributions by signing on for credits. Have you looked into applying for Invalidity Pension? It's not means-tested, and you can qualify on the basis of your current credited contributions plus your historical paid contributions. It is taxable, although in your circumstances, probably not at the high rate. Might be worth checking out on the basis of your medical situation.
You certainly should. As you say, you have paid your fair share into the system (overpaid, even, as per the other thread) and you are more than entitled to get whatever is available to you.Funny you should mention that as I was filing stuff and in 2012 I had to go into Pearce St, to justify my sickness benefit and they were satisfied I was still being treated for my cancer and said that they would be recommending that I be put foward for a some kind of pension. I did nothing about it as I was still on illness benefit and assumed it would naturally follow.
When I heard nothing I asked at the local SW office and they said I was probably not going to get it as it was means tested? And I did nothing about this after hearing that.
I had to fight for illness benefit to despite being in work since 1987, and on interim stuff from 2002 when we moved up from Cork.
But thanks for your advice I'll follow it up.
Why isn't the tax free lump sum 25% = €8,925?RPB has a surrender value of €35698, and I can take a lump sum tax free of €6632 and it says the remaining 29065 will be subject to normal taxation.
Thank you , I have asked that question myself and I don't know why.Why isn't the tax free lump sum 25% = €8,925?
Well I was only with the company 2 years and 10 months, my last annual salary was 47k basic would that make the figure correct?
Thank you , I'll have to get onto them and work out the figuresThere should be two methods of calculating the lump sum mentioned on the options letter. One is calculated using your salary and service and the other is a simple 25% of fund. I suspect that the one you quote above is based on salary and service. This method doesn't suit you in my opinion as it requires you to buy an annuity (fixed income for life) with the balance of the fund.
From what you are saying here I'd say you'd be better off taking 25% of the fund as a tax-free lump sum. If you then take the remaining 75% as a taxable lump sum, would that amount push you into the higher rate of tax, when your wife's income is taken into account? If so, an alternative would be an Approved Retirement Fund (ARF) from which you could withdraw lumps each tax year that would be of a sufficient size to keep you just below the 40% tax rate. For example, it's possible to set up an ARF and withdraw it all over 2 or 3 years.
One point if you're planning to withdraw the entire fund immediately ... what Irish Life fund(s) is it invested in? If it's invested in a fund that itself invests in equities and bonds, fund values are volatile at the moment. You could consider instructing Irish Life to switch your fund into their Cash Fund to freeze its current value while you make up your mind, gather paperwork to put in your retirement claim etc.
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