Public service notional yrs vs avc or prsa through labrokers

B

Bladerunner

Registered User
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Hi all

I am hoping to get some guidence here

My wife has 7 years remaining in a government agency, and is due to receive a pension of 14/80th on retirement plus gratuity of 21/80th ( Open to correct on this). She has always worked part time. She will have 31 yrs service by retirement age. The question is how best go about increasing her future pension and gratuity.

I know she can buy notional years, but maybe AVC'S are a better option. What would she be entitle to invest in AVCs each year, if her actual earnings where 20,000 a year. Full salary would be 40,000.
 
If she will qualify for a pension of 14/80 then her lump sum should be 42/80 or 3/80 for each full year of service or equivalent. Notional years are quite expensive and require her to live many years after retirement to get the cost back. She can take out a prsa/AVC or AVC PRSA, exact product needs to be defined by the experts on here. Depending on her age, she can contribute the difference between her superannuation deduction and 30 or 35% of salary. I would prefer the prsa avenue as you have more control but you need expert advice, e.g. Cornmarket or Irish Pensions & Finance.
 
I don't fully understand the way you've worked out the years. But it doesn't really affect your question regarding AVC or Notional Service Purchase!
Remember she can only get tax relief if she has paid tax. The percentages mentioned by Slim, refer to eligibility for tax relief - but as she works part-time she may not pay enough tax to fully avail of this.
 
@POC, We are jointed accessed for tax purposes, and would pay approx 8, 000 euro in tax per year. If she brought AVC's, can it be offset against our joint tax assessment
 
I don't think so - I think she can only get tax relief on tax she paid - but I'm not an expert! Hopefully someone else here is more knowledgeable......
 
Bladerunner said:
She is paying a full stamp and will have over 40 yrs of full stamp paid
Click to expand...
If she has, she should investigate her entitlement to a Contributory Pension. If she has 31 yrs service, she most likely avoided the introduction of Rate A PRSI for all new entrants to the public service from 1/4/1995.
If she qualifies for Contributory Pension, she will fare out far better than purchasing notional service(now very expensive) os going the AVC route ( have they increased in value since 2007?)
 
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