Beat The 0.6% Pension Levy

The following are some ideas on how to avoid or reduce the impact of the new levy on pension schemes.


1) Reducing the contribution charge or annual management charge on your existing pension would offset some/all of the new levy

2) If you are the holder of a Personal Pension or PRSA and you have reached the age of 60, it is possible to avoid the new 0.6% levy by ‘maturing’ your pension, taking your tax-free-cash and transferring the balance in to a ‘Vested’ PRSA or multiple vested PRSAs.

With a Vested PRSA you do not have to take the taxable imputed distribution (5%) that is normal under an Approved Retirement Fund (ARF). The vested PRSA can run to age 75 without the need to buy an ARF or Annuity.

3) If you can afford to increase your payments to your pension (subject to Revenue limits) this increase could negate some/all of the levy in the form of tax relief on the higher contribution.

4) If you have a Pension Retirement Bond (Buy-Out-Bond) and you have reached the age of 50 you should be able to ‘mature’ this, take as much tax-free-cash as you can and use the balance in accordance with the rules of the original scheme.


Low Cost Pension Products