ITC
were proud to sponsor the Irish Taxation Institute Annual Conference last weekend in Galway where over 370 delegates attended. Bucket List's were a hot topic throughout the Conference as we invited delegates to share their's with us in the hope of winning a New iPad. An ITC Pension can ensure that you make the most out of your retirement. Our bucket will be seen at many more events in the coming months so be sure to have your list at the ready. A sample of some of the entries we received:
"To dance the Argentine Tango with Antonio Bandero"
"To become the No. 1 Formula One Driver"
"To star in a musical on the West End"
"To visit the 7 Ancient Wonders of the World"
The seminar topics ranged
from a general update on the 2012 Finance Act to more specific topics such as
Capital Taxes, Business Taxes and Property Taxes.
One
of the more interesting topics for the delegates from ITC was the Pensions
seminar. Most of the key take home points have been the subject of ITC Blogs
over the last number of months, and the top five to consider are:
1. Fund to SFT as soon as possible
Individuals whose pension fund is
currently less than €2.3m should consider funding their pension to €2.3m
(taking account of a buffer for future investment returns within the fund up to
retirement) in light of announcements to decrease tax relief on pension
contributions and other potential changes that may be introduced in the
future.
2. Consider
de-risking pension if close to SFT
For individuals that are close to the
SFT, consideration should be given to reducing investment risk (employing a
de-risked pension investment strategy – e.g. cash/bonds), with increasing
urgency depending on how close one is to the SFT.
3. Critical that pension funds are
monitored re SFT ceiling
Advisors should consider putting a
tracking system in place to determine when an individual’s pension fund may be
coming close to the SFT so that alternatives can be considered in advance.
4. Maximising lump sum at retirement
remains attractive –
13% effective tax up to €575K. Tax credit up to the amount of tax paid on the
lump sum is available against tax payable on any chargeable excess over
SFT.
5. Employer Pension Contributions – Incorporation of business can
increase the level of pension contributions allowed and can involve family
members in the business.
We
will provide worked examples of these main points in the next few blog posts.
