Public sector employee and separate ‘standard prsa’

Dublin Abu

New Member
Messages
21
I am a public sector employee - A prsi - for around 20 years.
I also have a small private business and have a separate tax liability each year.
For past 5 years I made contributions to a ‘PRSA’ and received relevant tax benefit also.
Appears current valid of this pension product is around €40k

I had a ‘financial review ‘ with an independent broker. He says my PRSA is not best or appropriate tax efficient product for someone in my category.

I wonder what could be wrong with having this extra pension.

not sure if I am explaining situation correctly. I can add info if required.
 

RetirementPlan

Registered User
Messages
118
Additional info on the broker's rationale would be helpful. Be cautious though, a bad broker could have one eye on the commission they might earn through 'churn', getting you to sell out from one fund into another.

AFAIK, the tax treatment of such funds are all the same, so you're not going to be more tax efficient by changing funds.

Provide details of the fund that you are in and the charges that apply to that fund if you can.
 

RetirementPlan

Registered User
Messages
118
Zurich balanced pension and investment ?
I can't find any reference to that as a fund name on the Zurich website, so I can't really comment. Are there details in your paperwork about the charges applied, and any particular comments from the broker on the tax efficiency issue?
 

GSheehy

Registered User
Messages
470
@Dublin Abu

Is the PRSA an AVC PRSA that's linked to your PS Scheme or is it a PRSA that you set up independent of the PS Scheme to offset a tax liability from your small business income?

He must have said why the product wasn't tax efficient for you, surely?

I don't suppose it has anything to do with Revenue Tax Briefing 74 that deals with Dual Incomes for health specialists??

Gerard

www.prsa.ie
 

Dave Vanian

Registered User
Messages
830
If your Public Service income is greater than €115,000 then you cannot claim tax relief on pension contributions in respect of separate income. You can only pay additional contributions in respect of your Public Service income.
 

Zeus2020

Registered User
Messages
17
I am in a similar situation I have a prsa / avc with Zurich in world global fund ,just wondering what happens when I retire from the hse with 18 years service at 65 , salary 40 000 as only work part-time and the prsa /avc is worth € 57 000 do I have to draw down both at the same time or could I let the prsa run until 70
 
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RetirementPlan

Registered User
Messages
118
I am in a similar situation I have a prsa / avc with Zurich in world global fund ,just wondering what happens when I retire from the hse with 18 years service at 65 , salary 40 000 as only work part-time and the prsa /avc is worth € 57 000 do I have to draw down both at the same time or could I let the prsa run until 70
Is the PRSA relating to your current employment with HSE? If so, I believe you have to retire at the same time for both your main employment and the PRSA. You probably don't have to draw down your PRSA though, so you could leave it invested until you need it afaik.

If it relates to a previous employment, it might be worth retiring early for the PRSA, and recycling that money through a new AVC for your main employment, to boost it with tax relief. Please see my separate thread on 'recycling' for more details.
 

Dave Vanian

Registered User
Messages
830
I am in a similar situation I have a prsa / avc with Zurich in world global fund ,just wondering what happens when I retire from the hse with 18 years service at 65 , salary 40 000 as only work part-time and the prsa /avc is worth € 57 000 do I have to draw down both at the same time or could I let the prsa run until 70

If it's an AVC PRSA set up to supplement your HSE pension, you must draw it down at the same time as you draw your pension from the superannuation scheme. What you draw from the AVC PRSA must take into account what you're drawing from the main scheme.
 

Itchy

Registered User
Messages
541
If it's an AVC PRSA set up to supplement your HSE pension, you must draw it down at the same time as you draw your pension from the superannuation scheme. What you draw from the AVC PRSA must take into account what you're drawing from the main scheme.

If you have employment periods in both the public sector and civil service Is that also the case? (Normally service would transfer across) Or would there be seperate avc prsa's attached to each employment?
 

Zeus2020

Registered User
Messages
17
Hi itchy was working the weekend no chance to reply I entially started cornmarket avc in 2004 then started my own one in 2007 as cornmarket were very expensive this was just a standard prsa withh zurich then in 2012 I took a career break and worked for company that does defined contribution so I had to open prsa/avc to get tax rebate so now I have
avc cornmarket 10 000
standard prsa Zurich 20 000
prsa/avc Zurich 37 000
the Zurich have been very good I only put in 18 000 and it’s gone up to 57 000
i mostly did them to get 40% tax rebate
now I’m back working withe the hse and paying superannuation but only part time pay very little tax so have not payed into them in years
i would like to know what my options are when I retire at 65 I’m the old system as joined in 1996
thanks for any replies
 

RetirementPlan

Registered User
Messages
118
Hi itchy was working the weekend no chance to reply I entially started cornmarket avc in 2004 then started my own one in 2007 as cornmarket were very expensive this was just a standard prsa withh zurich then in 2012 I took a career break and worked for company that does defined contribution so I had to open prsa/avc to get tax rebate so now I have
avc cornmarket 10 000
standard prsa Zurich 20 000
prsa/avc Zurich 37 000
the Zurich have been very good I only put in 18 000 and it’s gone up to 57 000
i mostly did them to get 40% tax rebate
now I’m back working withe the hse and paying superannuation but only part time pay very little tax so have not payed into them in years
i would like to know what my options are when I retire at 65 I’m the old system as joined in 1996
thanks for any replies
Were you also working for the HSE when you were paying into these policies?
 

RetirementPlan

Registered User
Messages
118
AFAIK, this means for the Zurich fund, you can probably 'retire' for the purpose of this fund at any time after 50 years of age, so it might be helpful if you want early retirement. You could also think about 'recycling' that money from the Zurich fund into additional AVC contributions on your main employment as you approach retirement age, to maximise your tax relief. I've a separate thread on that topic in this forum if you want to explore that further.
 

Zeus2020

Registered User
Messages
17
Hi retirement plan
I’ve read your other tread and it looks like you are in the process of doing this when you are further along this process would you mind posting as not sure what I need to do and it would benefit other aam users in similar circumstances
 

RetirementPlan

Registered User
Messages
118
Hi retirement plan
I’ve read your other tread and it looks like you are in the process of doing this when you are further along this process would you mind posting as not sure what I need to do and it would benefit other aam users in similar circumstances
Thanks, I'm a few years away yet (unfortunately), so I won't have any imminent news. It almost seems to fall into the 'too good to be true' category, so I'd love to hear thoughts from other AAM users who know more about this stuff than me.

The thread is titled "Public servant nearing retirement - should I recycle private pension fund into AVCs" for anyone interested.
 
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