TaxSource Total

Here you can access summary of the key current tax developments in Ireland, the UK and internationally as reported by Chartered Accountants Ireland

The report of key tax developments are displayed per year, per month, by Ireland, the UK or International and by report title

Pension Taxation

Relief for Chargeable Excess

Where the value of an individual's pension benefits at retirement exceed the reduced Standard Fund Threshold (SFT) of €2.3 million (or a higher Personal Fund Threshold – PFT), a chargeable excess subject to penal taxation arises.

Measures have been introduced in the Bill to reduce the immediate tax burden where a chargeable excess arises by providing that:

  • No more than 50% of a retirement lump sum can be appropriated to pay the tax liability
  • The remaining tax liability, if any, can be covered by either a distribution from an ARF and/or by way of a reduction in the gross annual pension payable under the scheme over a max period of 10 years
  • A credit will be allowed for tax paid on excess retirement lump sums over €200,000

Public and Private Sector Pensions

Provision has been introduced to allow individuals a one-off opportunity to cash in their private pension savings, in whole or in part, with a view to avoiding a chargeable excess arising when the public service pension crystallises. Tax at the marginal rate will apply to the encashment.