The deadline for final tax payment for the 2020 tax year under the self-assessment system is fast approaching. One way to reduce your tax liability is to make a contribution to an approved pension arrangement.
Income-tax relief is available from the pension contributions you make to one of the following pension arrangements:
- Occupational pension schemes,
- Personal retirement saving accounts,
- Retirement annuity contracts.
Tax relief is available at your marginal rate of tax, subject to an earnings limit of €115,000 and contribution rates which are dependent upon your age as follows:
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There are also tax advantages at retirement, in that you can take up to 25% of your fund as a lump sum, with up to the €200,000 available tax free. Your funds also accumulate tax free while invested.
You can still be eligible for a tax refund for 2020 by putting money into a pension scheme and submitting a claim to the Revenue before 31 October 2021 (later if you submit your return online).
Law Society members who are self-employed, in partnership, or in non-pensionable employment are eligible to make a pension contribution to the Law Society Retirement Trust Scheme. The scheme offers all the flexibility of a personal policy and, in addition, offers a number of enhanced features, including a simple and transparent charging structure and best-in-class investment management. There is also a flexible ‘lifestyle strategy’ in place that gradually reduces the level of equity risk in your retirement fund the closer you get to your chosen retirement age.
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There are currently five fund offerings available to members of the Society under the Retirement Trust Scheme, which the investment committee is confident represent high-quality retirement and tax-saving solutions to members.
More information can be obtained from the scheme administrator at Mercer by emailing JustASK@mercer.com or by phoning 1890 275 275. A copy of the explanatory booklet can also be found on the Law Society’s website.
This communication is provided for information only and does not provide advice or a recommendation. Mercer (Ireland) Ltd, trading as Mercer, is regulated by the Central Bank of Ireland. Registered Office: Charlotte House, Charlemont Street, Dublin 2. Registered in Ireland No 28158.
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