- FAQs
- Pensions FAQs
Pensions FAQs

The answers you're looking for
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Yes, any payments from an approved retirement fund (ARF), Vested PRSA and annuity are treated as income and taxed under the PAYE system. This means your payment may be liable to income tax, PRSI and Universal Social Charge. It's important to allocate any available tax credits to your ARF, Vested PRSA or annuity. See our Guide to your payments for more information.
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On a taxed cash lump sum, approved retirement fund (ARF) withdrawals, and/or Vested PRSA withdrawals, if you were born on or after 1 January 1958 and aged between 66 and 70, until you start taking your State Pension (Contributory), we’re required to deduct PRSI Class S (currently 4.1%). Once you start taking your State Pension (Contributory), the Revenue should notify us through your Revenue Payroll Notification and we will change your PRSI to Class M (currently 0%). If we are still deducting PRSI 4.1% you will need to directly contact the Department of Social Protection to have your details updated so that the Revenue issue us with a revised Revenue Payroll Notification.
On an annuity, regardless of your age or whether you have started taking your State Pension (Contributory), the PRSI is Class M (currently 0%).
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Each year, the Revenue apply a tax on an assumed withdrawal of a certain percentage from your approved retirement funds (ARFs) and Vested PRSAs. This is known as imputed distribution. To facilitate this tax, we pay you a withdrawal in December, which is taxed under the PAYE system. The amount to be paid is calculated using the value of your policy on 30 November each year.
The percentage is
- 4%, if you're 60 years of age or over for the full tax year, or
- 5%, if you're 70 years of age or over for the full tax year, or
- 6%, if you've combined ARF and vested PRSA assets of €2 million or more, and aged 60 or over for the full tax year
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Your payments will only increase if, at the time you bought the annuity, you chose to have your payments increase by a certain percentage each year. The increase would be applied each year on the anniversary date of your policy.
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It's important to allocate any available tax credits to your approved retirement fund (ARF), Vested PRSA or annuity provider to avoid being taxed at the emergency rate. See our Guide to your payments for more information.
Retirement income
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You need your own pension because the State pension isn't that generous. The full personal State Pension (Contributory) is just over €15,000 a year. Compare this to your salary now and the income you hope to live on when you retire. This is why you need your own pension.
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A personal pension policy is a Revenue approved contract set up with a life assurance company by a self-employed person to save for retirement. It can also be set up by an employee who does not have access to a pension scheme organised by their employer. Tax relief is available on contributions to the policy to encourage saving for retirement (within Revenue limits). The formal name for a personal pension policy is Retirement Annuity Contract.
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A PRSA is similar to a personal pension policy, designed by legislation to improve saving for retirement. It is a Revenue approved contract set up with a PRSA provider by an individual to save for retirement. Tax relief is available on contributions to the policy to encourage saving for retirement (within Revenue limits). A Vested PRSA is a PRSA from where you have already taken a retirement cash lump sum and/or income.
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A buy out bond (also known as a personal retirement bond) is a policy where you can transfer your pension fund if you leave a company pension scheme or if the pension scheme is being shut down. The trustees set up the buy out bond for you and put you in control, so they don't have to be involved any more.
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An executive pension plan is a Revenue approved occupational pension scheme set up by an employer under trust to save for one or more employees' retirement. Tax relief is available on contributions paid by the employer and employee to encourage saving for retirement (within Revenue limits). Standard Life's Synergy Executive Pension plan is a one-member scheme. Standard Life's Tower Pension Series, Corporate Pension Series and Executive Pension Plus plans are multi-member group schemes.
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A group pension scheme is a Revenue approved occupational pension scheme set up by an employer under trust to save for a large number of employees' retirement. Tax relief is available on contributions paid by the employer and employee to encourage saving for retirement (within Revenue limits). See Group Pension Scheme FAQs
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The amount of tax relief on your personal contributions to all pension arrangements is based on your age and your earnings.
Your age % net relevant earnings* Under 30 15% 30-39 20% 40-49 25% 50-54 30% 55-59 35% 60 or over 40% * for the 2024 and 2025 tax years, net relevant earnings are subject to a ceiling of €115,000 each year for the purpose of calculating tax relief.
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Send us a cheque, together with your policy number and investment choice to:
Standard Life
90 St Stephen's Green
Dublin D02 F653Instead of writing a cheque, you can make a direct credit payment/EFT to us. Our BIC is HSBCIE2DXXX, and our IBAN is IE81 HSBC 990231 37001649, and quote your policy number in the reference/message field. After you’ve made a transfer, let us know by calling us on +353 1 639 7000. Alternatively, you can email us at newbusiness@standardlife.ie. If you’re emailing us, please be security aware. There’s no guarantee that any email you send us will be received, or that it will remain private and unaltered during internet transmission.
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Yes, because if all your pension funds total more than €2m, you'll have to pay an additional tax (currently 40%) on the excess.
If you have already taken a pension lump sum, and/or are being paid a pension, talk to your financial adviser as the limits may be different. If you remain invested in your PRSA after taking a cash lump sum (some or all of which may be tax-free),or buy an annuity and/or invest in an ARF, any payments from them will be treated as income and taxed under the PAYE system. -
Yes, if you're a member of a company pension scheme. You'll need to get the receiving scheme to confirm that the pension benefits will be similar to what you are transferring from and it's approved by the country's pension regulator. You can also transfer a PRSA, but the transfer will be subject to income tax, PRSI and USC, which must be deducted before the transfer takes place.
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Your pension is to provide for your retirement and you can't normally cash it in before age 60.
There are circumstances where you can retire as early as age 50. This would normally require the approval of your employer and/or Revenue.
Where you are permanently unable to work or terminally ill, you may be able to retire at any time with the approval of Revenue and/or Standard Life. -
Normally age 60, if you take early retirement from your employer (from age 50), you may be able to take your pension at the same time. If you are in an occupation where early retirement is normal, the Revenue may allow you to take your pension as early as age 50. If you are permanently unable to work due to serious illness or disability, you may be able to take your pension at any age.
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Pension (Vested PRSA, ARF and annuity) payments are treated as income and taxed under the PAYE system (for example, income tax, PRSI, USC).
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25% of the value of your pension policy.
Taking all your pension arrangements (both Irish and foreign) into account, the first €200,000 cash lump sum is tax free. The next €300,000 will be taxed at 20%. Anything over €500,000 will be treated as income and taxed under the PAYE system.
If you are a member of a company pension scheme, you have the option of taking a lump sum based on your salary and length of service instead.
If you have already taken some pension benefits or are in a defined benefits scheme, then talk to your financial adviser as the limits that apply to you may differ.
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If you have a personal pension or a PRSA, the maximum amount of pension depends on your policy value and annuity rates at the time.
If you are a member of a company pension scheme, it is 2/3rds final salary provided you have 10 years service to normal retirement age and you don't have other pension benefits from other employments.
An alternative to, or in combination with buying an annuity, you may have the option of investing in an approved retirement fund (ARF), or, if you’re invested in a PRSA, remaining invested after retirement (Vested PRSA), where you can draw down an income as and when you need it. But, with an ARF or Vested PRSA, you could run out of money if
- your investments perform poorly, or
- you live a long time, or
- you take too much income.
You should talk to your financial adviser about which options are available and right for you.