When Can I Access My Private Pension Fund?
The financial impact of the Coronavirus is being felt my almost everybody in society at the moment. As cashflow tightens and business owners and employees assess their own finances, we have seen an increase in enquiries from people looking to access their Pension.
What are the rules?
There are very strict Revenue rules regarding when and how you can access your private pension fund. These rules relate to your age, employment circumstances, the type of pension you have, and the format of access in terms of the tax-free cash lump sum calculation.
The below table gives a brief outline in broad terms of what might be possible and worth considering depending on your own needs. It’s important to note these are general guidelines and there are specific requirements and knock on implications in each case that may influence your options:
| Employment Type | Type of Pension | Pension Can Be Accessed From Age? | Do I Need To Retire From My Business Or Employment If I Access My Pension? | What Tax Free Lump Sum* Am I Allowed To Access From My Pension? |
| Company Director / Owner | PRSA, Occupational Pension, Executive Pension, Company Pension |
From Age 60 |
No |
25% of Pension Fund Value or up to **1.5 times Salary |
| Company Director / Owner | PRSA, Occupational Pension, Executive Pension, Company Pension |
From Age 50 |
Yes |
25% of Pension Fund Value or up to **1.5 times Salary |
| Employee in a Private Company | PRSA, Occupational Pension, Executive Pension, Company Pension |
From Age 60 |
No |
25% of Pension Fund Value or up to **1.5 times Salary |
| Ex Employee / Previous Employment Pension | PRSA, Occupational Pension, Executive Pension, Company Pension, Personal Retirement Bond |
From Age 50 |
NA as Ex- Employee |
25% of Pension Fund Value or up to **1.5 times Salary |
| Self Employed Sole Trader or Partnership | Personal Pension or PRSA |
From Age 60 |
No |
25% of Fund Value in most cases |
*Accessing your Pension and taking a tax free cash lump sum will result in the balance of your fund being invested in an Annuity, Approved (Minimum) Retirement Fund or taken as Taxable Cash.
**1.5 times salary as a tax-free lump sum is the maximum allowed and depends on a number of factors such as length of service with the company and P60 income from the relevant employment.
I hope this helps you make sense of your Pension Access options during this difficult time. Accessing your Pension is one of the most important financial decisions you can make with far reaching implications that need to be understood and discussed with a professional Pension Advisor before any decision is made.
If you would like to learn more or discuss how we might be able to help, please reach out to us, we are open for business.
Thank you for reading and take care.
Michael Coburn and Jim Doyle
Guardian Wealth
Serving the South East, Midlands, East Coast & Dublin
Email: mcoburn@guardianwealth.ie
Phone Joanne on 01 5260770
