The Insured Executive Retirement Plan is a pension structure held with a life assurance company and is available to company owners and employees. The main benefits of these types of retirement plans are as follows:

• They facilitate funding for retirement.
• They can reduce both corporate and personal tax rates.
• They allow the holder access to a range of funds provided by that life company.
• They enable the holder to extract funds from a company without any income tax liability.
• They allow for significantly greater levels of pension contributions than personal pension structures.
• A portion of the fund may be taken as a tax-free lump sum at retirement.
• They allow for a potential transfer of assets to next of kin.

A personal pension plan is a private pension structure available to the self-employed individual or to those in non-pensionable employment. The traditional personal pension plan is managed for the holder by a life assurance company or investment firm in order to provide benefits for the holder in retirement. The value of the pension fund at retirement will depend on the level of contributions made to the plan, the investment growth of the pension fund and the level of pension charges paid throughout the term of the plan. A portion of the fund may be taken as a tax-free lump sum at retirement.

A PRSA can be summarised as follows:

• It is a personal pension plan that can be taken out with an authorised PRSA provider.
• It is a tax-free structure that facilitates saving and investing for retirement.
• It is a type of defined contribution scheme where the holder can make regular contributions to it, which are tax-deductible, the amount of tax relief available is dependent on the holder’s age and their level of relevant earnings.
• It is a flexible pension structure that allows the holder to increasing, decrease or stop their contributions at any time without any charge or penalty for doing so.
• It is a portable pension structure that can be carried from job to job or transferred to another PRSA provider, without any charge or penalty for doing so.
• It is a type of personal pension plan that gives the holder significant flexibility in drawing down benefits, including the facility to continue making contributions while drawing benefits.
• It facilitates both personal contributions and employer contributions. The total contribution limits are influenced by age and are a percentage of net relevant earnings, up to an “earnings ceiling” of €115,000 as illustrated below.

A Personal Retirement Bond is an individually owned pension policy which can be taken out by a member of an occupational pension scheme on leaving employment, leaving the pension scheme or on scheme wind up. The value of the member’s pension fund at that time is transferred to a Personal Retirement Bond to provide retirement benefits in line with the rules of the transferring occupational pension scheme.

A Personal Retirement Bond can only accept transfers related to the same employment and no ongoing contributions are permitted.

A Small Self Administered Scheme (SSAS) is a flexible arrangement which allows the holder a significant level of control over their retirement fund. There are a number of benefits to holding an SSAS:

• They facilitate funding for retirement.
• They can significantly reduce both corporate and personal tax rates.
• They allow the holder greater flexibility with regard to making investments in a tax-free environment.
• Almost any investment can be made within these tax-efficient structures subject to Revenue guidelines.
• They enable the holder to extract funds from a company without any income tax liability.
• They allow for significantly greater levels of pension contributions than personal pension structures as they can facilitate both personal and company contributions.
• They allow for the potential transfer of assets to the next of kin.

Tax Benefits
An SSAS has a number of tax benefits. Contributions made to the SSAS enjoy personal and/or corporation tax relief. Returns from the investments held within the trust are exempt from income tax, capital gains tax and DIRT. Also, a portion of the fund (25%) may be taken as a tax-free lump sum at retirement.

Contributions
There is no set amount that a holder has to contribute to an SSAS annually and few rules with regard to the frequency of these contributions. There are, however, some limitations on the amount that the holder can contribute personally or their employer can contribute on their behalf. These limitations vary depending on the individual’s age, a number of years’ service, salary and whether the holder has any existing pension benefits.

Suitability
In many cases, the SSAS is the best way for proprietary directors to fund for their future as it is the most tax efficient way to transfer company profits into personal capital. An SSAS can be set up for key employees and is an extremely tax efficient way to reward valued staff.
Investing with an SSAS
Once an SSAS has been set up and has received Revenue Approval, the holder can then begin investing. There is a wide variety of investment options available to an SSAS and borrowing can also be facilitated within the fund. There are some restrictions on the investments that the fund can make, specifically the following:

Self-investing is not allowed – investments have to be at arm’s length, so, for example, the holder can’t use the pension fund to purchase a property for their own use. However, the fund can purchase an investment property which can be rented (free from tax) to an unrelated party.Investing in pride in possession articles is prohibited such as vintage cars or fine wines.

Holders of a personal pension plan are entitled to receive full income tax relief at their marginal tax rate on their pension contributions based on current legislation (there are proposed changes to this but it is not yet clear if these will come into practice). However, there are limits on the amount of tax relief that can be claimed. As highlighted below, these limits are influenced by the person’s age and is a percentage of their net relevant earnings, up to an “earnings ceiling” of €115,000. Holders of these plans are entitled to pay their pension contributions monthly or annually by direct debit or can pay a “once-off” contribution e.g. at the end of the tax year depending on their taxable earnings. 

Age	% of relevant earnings eligible for tax relief
Under 30 years	15%
30 – 39 years	20%
40 – 49 years	25%
50 – 54 years	30%
55 – 59 years	35%
60 years and over	40%