Public Service Pension drawbacks (if any)

[messyleo]

No - the 3%+ 3.5% includes the Spouses' pension.

Apologies I didn't mean on top of the 6.5% I just meant you *have* to pay into a spouses pension scheme/cover even if you don't have one!
Also it's only 1.5% to correct my earlier post but still, I'll never be using it so it grates a lot!

 

[Early Riser]

Is this true? I have never heard the 6.5% being broken down like that.

It is true:

"The personal contribution is 1½% of pensionable remuneration plus 3½% of net pensionable remuneration

Officers also pay contributions of 1½% of pensionable remuneration for spouses’ and children’s pension (question 30).

Pensionable remuneration is basic salary plus pensionable allowances. Net pensionable remuneration, for the purpose of contributions, is pensionable remuneration, less twice the maximum rate of Social Welfare Contributory Old Age Pension payable to a single person"

http://www.cspensions.gov.ie/faq2.asp#4 FAQ 4

 

[Protocol]

Not forgetting there is no tax relief on the PRD.

There is tax relief on the PRD.

 

[Protocol]

Not quite. I believe it is 3% gross remuneration plus 3.5% net remuneration (ie, gross remuneration - State pension*2).
.
So for a full time person on a gross of €46,000 the contribution is €1380 + €700 = €2080 = 4.5% of gross remuneration.

This is before PRD, of course (are they still seperate deductions or has it all been integrated now?).

Yes, it is not a straight 6.5% of salary, as you say. I didn't go into the details as they are complicated.

The PRD is now renamed the ASC, and is made permanent.

It is still a separate line on the payslip.

The ASC is less for the PS in the new Single Scheme.

 

[PebbleBeach2020]

If in the example you quote, the Final Salary is €100,000 (so 50% Pension plus 150% lump sum), the answer is NO
If however this is a Post 1995 (Inregrated Scheme) then the Pension of €50,000 would be inclusive of the State Pension (Scheme Pension of c€37,000 + State Pension of c€13,000). So technically, you could invest AVCs to increase the €37,000 scheme pension up to €50,000.
But if the €150,000 represents 150% of Final Salary, then you cannot use AVCs to increase that to €200,000.
The Revenue lump sum limit is 150% of Final Salary. The first €200,000 of any lump sum is tax free, but you would need to have a Final Salary of c€133,000 to be able to take €200,000 as a lump sum.

That's penalising civil service employees isn't it?! Private sector and regardless of salary, you can build yr pension pot as much as you can or want. So as a civil servant is there no benefit or point in doing an AVC or pension if, I retire at 65 with 40 years service and final salary if 100k?

Is my only option to do so, if I wanted to go at say 60 with 35 years service and I top up (not buy notional service) to make my actuarially reduced lump sum and pension upto what I would receive with full service. Thanks.

 

[Conan]

Firstly, you cannot build up a “pension pot as big as you can” either in the Public or Private sector. There are Revenue rules in terms of how much benefits you can provide in an approved pension arrangement.
If you have full service in the Public Service (pre 1995) then you effectively get the Revenue max:
- a pension of 40/80ths (50%) of Final Salary, plus
- a lump sum of 120/80ths (150%) of Final Salary
- attaching Spouses Pension
So if you will have 40 years service by retirement at Normal Retirement Age (and are in the Pre1995 Scheme) then there may be little scope for AVCs.
Strictly speaking you are not supposed to be able to do AVCs in anticipation of retiring early, but I understand that some people can manage to do so.

 

[PebbleBeach2020]

Firstly, you cannot build up a “pension pot as big as you can” either in the Public or Private sector. There are Revenue rules in terms of how much benefits you can provide in an approved pension arrangement.
If you have full service in the Public Service (pre 1995) then you effectively get the Revenue max:
- a pension of 40/80ths (50%) of Final Salary, plus
- a lump sum of 120/80ths (150%) of Final Salary
- attaching Spouses Pension
So if you will have 40 years service by retirement at Normal Retirement Age (and are in the Pre1995 Scheme) then there may be little scope for AVCs.
Strictly speaking you are not supposed to be able to do AVCs in anticipation of retiring early, but I understand that some people can manage to do so.

I'm post 1995 not pre. I started in 2006.