Pensions: Revenue Law and Practice
- Chapter 1 Overview of Pensions
- 1.1 Overview of Chapter
- 1.2 Introduction
- 1.3 Historical development of pensions
- 1.4 First Pillar - State Pension System
- 1.4.1 Contributory pension at retirement
- 1.4.2 Means-tested pension
- 1.4.3 Supplementary benefits
- 1.4.4 International agreements
- 1.4.5 First Pillar interaction with Second Pillar schemes
- 1.5 Second Pillar - Employer Sponsored and Privately Funded Pensions
- 1.5.1 Public sector schemes
- 1.5.2 Funded schemes
- 1.5.3 Personal pensions
- 1.5.4 Personal Retirement Savings Accounts
- 1.5.5 Occupational Pension Schemes
- 1.5.6 Approved Retirement Funds
- 1.5.7 Regulatory framework and applicable law
- 1.6 The Third Pillar - Personal Savings
- 1.7 The Fourth Pillar - Earnings in Retirement
- 1.8 The Future for Pensions
- 1.9 Structure of Book
- 1.10 Further Reading
- Chapter 2 Personal Pension Contracts
- 2.1 Overview of Chapter
- 2.2 Recent Developments
- 2.3 Introduction
- 2.4 General Conditions
- 2.4.1 Revenue approval
- 2.4.2 Made by an individual
- 2.4.3 Company contributions
- 2.4.4 Spouses
- 2.4.5 Taxable earnings
- 2.4.6 Insufficiency of taxable earnings
- 2.4.7 Example 1
- 2.4.8 No taxable earnings
- 2.4.9 Example 2
- 2.4.10 Proprietary directors and employees
- 2.4.11 Insurance contract
- 2.4.12 Trust schemes
- 2.4.13 Approved Retirement Funds
- 2.4.14 Security issues
- 2.4.15 Overseas contracts
- 2.5 Retirement Benefit Structures
- 2.5.1 Mandatory conditions
- 2.5.2 Additional options
- 2.5.3 Retirement transfer options
- 2.5.4 Transfer to an ARF or to policyholder
- 2.5.5 Transfer to a PRSA
- 2.5.6 Pre-retirement transfers
- 2.5.7 Open market option - pre-6th April contracts
- 2.5.8 Open market option - post-5th April contracts
- 2.5.9 Family Law Act transfers
- 2.5.10 Transfers to PRSAs
- 2.5.11 Phased retirement
- 2.5.12 Example
- 2.6 Death Benefit
- Chapter 3 Personal Retirement Savings Accounts
- 3.1 Overview of Chapter
- 3.2 Recent Developments
- 3.3 Structure of PRSA
- 3.3.1 Definition
- 3.3.2 Regulation
- 3.3.3 Product approval
- 3.3.4 Withdrawal of approval
- 3.3.5 PRSA assets
- 3.3.6 Borrowing
- 3.3.7 Reporting requirements
- 3.3.8 PRSA registers
- 3.4 PRSA Service Providers
- 3.4.1 Auditor
- 3.4.2 Actuary
- 3.4.3 Administrator
- 3.4.4 Investment manager
- 3.4.5 Custodian
- 3.4.6 Employers
- 3.5 PRSA Contracts
- 3.5.1 Eligibility
- 3.5.2 Disclosure
- 3.5.3 Default Investment Strategy
- 3.5.4 Other investments
- 3.5.5 Charges
- 3.5.6 Costs
- 3.5.7 Contributions
- 3.6 Benefit Structure
- 3.7 Withdrawal of Revenue Approval
- 3.8 Marketing
- 3.9 Statement of Reasonable Projection
- 3.10 Account Statements
- 3.11 Transfers
- 3.11.1 Transfers in - Pensions Act requirements
- 3.11.2 Transfers in - Tax legislation requirements
- 3.11.3 Transfers out
- 3.11.4 AVCs and Buy Out Bonds
- 3.11.5 Additional Voluntary Contributions
- 3.11.6 Buy Out Bonds
- 3.12 Further Reading
- Chapter 4 Approved Retirement Funds and Vested PRSAs
- 4.1 Overview of Chapter
- 4.2 Recent Developments
- 4.3 Approved Retirement Fund (ARF)
- 4.3.1 Beneficial ownership of ARF holder
- 4.3.2 Tax treatment of ARFs
- 4.3.3 Tax on profits
- 4.3.4 Taxation of benefits
- 4.3.5 Deemed drawdown
- 4.3.6 Structure of an ARF
- 4.3.7 Accessing an ARF
- 4.3.8 Timing of the option
- 4.3.9 Option procedure
- 4.3.10 Lump sums
- 4.3.11 Timing of lump sum
- 4.3.12 Limits on lump sum
- 4.3.13 Multiple ARFs
- 4.3.14 Investments in an ARF
- Chapter 5 Single Member Schemes
- 5.1 Overview of Chapter
- 5.2 Recent Developments
- 5.3 Introduction
- 5.3.1 Definition
- 5.3.2 Member discretion
- 5.3.3 Defined Benefit Schemes
- 5.3.4 Family Law Act Benefits
- 5.3.5 Documentation
- 5.3.6 IORPs Directive
- 5.3.7 Exemption from the IORPs Directive
- 5.3.8 Borrowing for Investment Purposes
- 5.4 Single Member Retirement Benefit Schemes
- 5.5 Advantages of One Member Arrangements
- 5.6 Further Reading
- Chapter 6 Small Self-Administered Pension Schemes
- 6.1 Overview of Chapter
- 6.2 Recent Developments
- 6.3 Definition of Small Self-Administered Scheme (SSAS)
- 6.4 Pensioneer Trustee
- 6.4.1 Investment Manager
- 6.4.2 Registered Administrator
- 6.4.3 Transfers
- 6.4.4 Trustee training
- 6.4.5 Reporting requirements
- 6.5 Scheme Investments
- 6.5.1 Loans to members
- 6.5.2 Self-investment
- 6.5.3 Property investment
- 6.5.4 Borrowing
- 6.5.5 Pride in possession articles
- 6.5.6 Private companies
- 6.5.7 General issues with investments
- 6.5.8 IORPs Directive
- 6.6 Benefits
- 6.7 The Future of SSASs
- 6.8 Further Reading
- Chapter 7 Defined Contribution Multi-Employee Schemes
- 7.1 Overview of Chapter
- 7.2 Recent Developments
- 7.3 Definition of Defined Contribution Scheme
- 7.4 Occupational Pension Scheme
- 7.5 Revenue Approval for Defined Contribution Schemes
- 7.6 Cross Border Schemes
- 7.7 Employers with Defined Contribution Schemes
- 7.8 Membership of a Defined Contribution Scheme
- 7.9 Contributions to a Defined Contribution Scheme
- 7.9.1 Account value
- 7.9.2 Status of the member’s account
- 7.9.3 Additional voluntary contributions (“AVCs”)
- 7.10 Benefits from a Defined Contribution Scheme
- 7.11 Investments for Defined Contribution Schemes
- 7.11.1 Members’ investment choice
- 7.11.2 Default investment option
- 7.11.3 Phased investment strategies or lifestyling
- 7.12 Compliance and Disclosure Requirements
- 7.13 Future Developments
- 7.14 Further Reading
- Chapter 8 Defined Benefit Multi-Employee Schemes
- 8.1 Overview of Chapter
- 8.2 Recent Developments
- 8.3 Defined Benefit Scheme
- 8.4 Occupational Pension Scheme
- 8.5 Revenue Approval for Defined Benefit Schemes
- 8.6 Cross Border Schemes
- 8.7 Single or Multi-employer Scheme
- 8.8 Membership of a Defined Benefit Scheme
- 8.9 Benefits from a Defined Benefit Scheme
- 8.9.1 Example
- 8.9.2 Death in service benefits
- 8.9.3 Death after retirement benefits
- 8.9.4 Integration with the State Pension
- 8.10 Contributions and Funding of Defined Benefit Schemes
- 8.10.1 Funding standard
- 8.10.2 Deficits
- 8.10.3 Funding proposals
- 8.10.4 Benefit reductions - section 50 direction
- 8.10.5 Risk reserve
- 8.10.6 Employer undertakings
- 8.10.7 Sovereign annuities and sovereign bonds
- 8.10.8 Types of defined benefit scheme
- 8.10.9 Example
- 8.10.10 Additional voluntary contributions (“AVCs”)
- 8.11 Public Sector Schemes
- 8.12 Wind Up of a Defined Benefit Scheme
- 8.12.1 Post the wind up event
- 8.12.2 Pension insolvency payment scheme (“PIPS”)
- 8.12.3 Protection of employees (employers’ insolvency) acts 1984-2004
- 8.13 Future Developments
- 8.14 Further Reading
- Chapter 9 Hybrid Schemes
- 9.2 Structure
- 9.2.1 Core retirement benefit, balance of retirement income, AVCs
- 9.2.2 Combination Hybrid Scheme - why two schemes?
- 9.2.3 Combination Hybrid - the defined benefit scheme
- 9.2.4 Combination Hybrid - the defined contribution scheme
- 9.2.5 Additional voluntary contributions
- 9.2.6 Diverse membership of the hybrid defined contribution scheme
- 9.2.7 Member’s investment choice under the Hybrid defined contribution scheme
- Chapter 10 Multi-Employer Schemes
- 10.2 Introduction
- 10.2.1 Approval conditions for Associated Employers Scheme
- 10.2.2 Adherence by associated employer
- 10.2.3 Contribution by associated employer
- 10.2.4 Cessation of association
- 10.2.5 Treatment on winding up
- 10.2.6 Non resident employer
- 10.2.7 Non resident employees
- 10.3.1 Approval conditions for industry wide group scheme
- 10.3.2 Example
- 10.4.1 Calculation of benefits
- 10.4.2 Example 1
- 10.4.3 Example 2
- Chapter 11 Structure of Occupational Pension Schemes
- 11.1 Overview of Chapter
- 11.2 Recent Developments
- 11.3 The Structure of an Occupational Pension Scheme
- 11.3.1 The Regulatory Regime
- 11.3.2 Revenue Commissioners
- 11.3.3 Revenue practice
- 11.3.4 Pensions Board
- 11.3.5 Overlapping regulatory authorities
- 11.4 Establishment of Schemes
- 11.4.1 The legal formalities for creating a trust
- 11.4.2 Parties to a trust
- 11.4.3 Trust documentation
- 11.4.4 Types of schemes under trust
- 11.4.5 Other scheme documentation
- 11.5 Revenue Approval
- 11.5.1 Category of tax relieved schemes
- 11.5.2 Approved schemes for tax relief
- 11.5.3 Retirement benefit scheme
- 11.5.4 Approval procedure
- 11.5.5 Timing and effect
- 11.5.6 Associated employers
- 11.5.7 Scheme alterations
- 11.5.8 Trustee changes
- 11.5.9 Effect of approval
- 11.5.10 Interim approval
- 11.5.11 Withdrawal of approval
- 11.5.12 Mandatory approval
- 11.5.13 Mandatory benefit requirements
- 11.5.14 Mandatory final remuneration
- 11.5.15 Discretionary approval
- 11.5.16 Particular discretion
- 11.6 Other Categories of Scheme
- 11.6.1 Exempt approved schemes
- 11.6.2 Irrevocable trust
- 11.6.3 Tax benefits
- 11.6.4 Investment return
- 11.6.5 Capital gains
- 11.6.6 Futures and options
- 11.6.7 Employer contributions
- 11.6.8 Employee contributions
- 11.6.9 Statutory schemes
- 11.6.10 Other schemes
- 11.6.11 Example 1 - Unapproved Scheme
- 11.6.12 Example 2 - Unapproved Scheme
- 11.6.13 Example 3 - Unapproved Scheme
- 11.6.14 Example 4 - Unapproved Scheme
- 11.6.15 Example 5 - Unapproved Scheme
- 11.6.16 Hancock annuity
- 11.6.17 Example 1 - Hancock Annuity
- 11.6.18 Example 2 - Hancock Annuity
- 11.7 Funding
- 11.7.1 The benefit
- 11.7.2 Defined benefit schemes
- 11.7.3 Defined contribution schemes
- 11.7.4 Maximum contributions
- 11.7.5 Funding calculation
- 11.8 Further Reading
- Chapter 12 Cross-Border Schemes
- Chapter 13 GMS Pension Scheme
- 13.4 Administration of the GMS Pension Scheme
- 13.4.1 Benefits at normal retirement date
- 13.4.2 How are benefits calculated at NRA
- 13.4.3 Methods of securing benefits
- 13.4.4 Benefits on death in retirement
- 13.4.5 Members with pension paid by the gms Pension Scheme
- 13.4.6 Example
- 13.4.7 Members with pension from a life office
- 13.4.8 Benefits on death in service
- 13.4.9 Example
- 13.4.10 Ill health early retirement benefits
- 13.4.11 Example
- 13.4.12 Withdrawal from the GMS Pension Scheme (Deferred Benefit)
- Chapter 14 Public Sector Pensions
- 14.1 Overview of Chapter
- 14.2 Recent Developments
- 14.3 Main Features of the Civil Service Scheme
- 14.3.1 Rules, contributions and benefits
- 14.3.2 History of superannuation schemes
- 14.3.3 Relevant legislation
- 14.3.4 Differences in schemes
- 14.3.5 Membership
- 14.3.6 Pensionable remuneration
- 14.3.7 Contributions
- 14.3.8 Main benefits
- 14.3.9 Retirement age
- 14.3.10 Pensionable/Reckonable service
- 14.3.11 Death in service benefits
- 14.3.12 Death in retirement - Balancing Gratuity
- 14.3.13 Short Service Gratuity
- 14.3.14 Example
- 14.3.15 Spouses’ and Childrens’ pensions
- 14.3.16 Retirement due to ill health
- 14.3.17 Pensions in payment
- 14.3.18 Cost neutral early retirement
- 14.4 Local Government Schemes
- 14.5 State Sponsored Bodies
- 14.6 North/South Pension Scheme
- 14.7 Advice Issues
- 14.7.1 Notional service
- 14.7.2 Example
- 14.7.3 Applying for notional service
- 14.7.4 Purchase of notional service scheme
- 14.7.5 Purchase conditions and rates
- 14.7.6 Purchase options
- 14.7.7 Additional Voluntary Contributions
- 14.7.8 Advantages of AVCs
- 14.7.9 Disadvantages of AVCs
- 14.7.10 Tax & PRSI relief
- 14.7.11 Preservation & transfer of benefits
- 14.7.12 Transferring benefits
- 14.8 Public Service Pension Deduction
- 14.9 Standard Fund Threshold
- 14.10 New Single Service Pensions Scheme
- 14.11 Further Reading
- Chapter 15 Social Welfare Pensions
- 15.1 Overview of Chapter
- 15.2 Recent Developments
- 15.3 Development of Social Welfare in Ireland
- 15.4 Overview of Social Welfare Pensions
- 15.5 Contributory Pensions
- 15.5.1 State Pension (Contributory)
- 15.5.2 State Pension (Transition)
- 15.5.3 Widow’s/ Widower’s or Surviving Civil Partner’s Contributory Pension
- 15.5.4 Invalidity Pension
- 15.5.5 Guardian’s Payment (Contributory)
- 15.5.6 Contribution levels
- 15.5.7 Contributory Pension at retirement
- 15.5.8 Eligibility criteria
- 15.6 Social Assistance
- 15.6.1 State Pension (Non-Contributory)
- 15.6.2 Widow’s/Widower’s or Surviving Civil Partner’s (Non-Contributory) pension
- 15.6.3 Guardian’s Payment (Non-Contributory)
- 15.6.4 Pre-Retirement Allowance
- 15.6.5 Guardian’s Orphan’s Pension
- 15.6.6 Dependent Parent’s Pension
- 15.7 Supplementary Benefits
- 15.8 International Agreements
- 15.9 Interaction with Private Pension Cover
- 15.10 Taxation of Social Welfare Pensions
- Chapter 16 Tax Treatment of Personal Contributions to Pensions
- 16.1 Overview of Chapter
- 16.2 Recent Developments
- 16.3 Introduction
- 16.4 Personal Pension and PRSA Contributions
- 16.4.1 PRSI relief
- 16.4.2 Backdating
- 16.4.3 Age of claimant
- 16.4.4 Contributions made in previous years
- 16.4.5 Earnings cap
- 16.4.6 Occupation of claimant
- 16.4.7 Limits on contributions to OPSs
- 16.5 Relevant Earnings
- 16.5.1 Income from an office or employment
- 16.5.2 Superannuation scheme
- 16.5.3 Pensionable employment
- 16.5.4 Excluded employments
- 16.5.5 Migrant workers
- 16.5.6 Relevant amounts
- 16.5.7 Attached property
- 16.5.8 Trading and professional income
- 16.5.9 General Medical Services (GMS) income
- 16.5.10 Patent Income
- 16.5.11 Foreign income
- 16.5.12 Non-pensionable foreign employment
- 16.5.13 Non-residents
- 16.5.14 Joint assessment
- 16.6 Net Relevant Earnings
- 16.6.1 Calculation of net relevant earnings
- 16.6.2 Deductible payments
- 16.6.3 Example
- 16.6.4 Interest
- 16.6.5 Example
- 16.6.6 Covenants
- 16.6.7 Example
- 16.6.8 Expenses of employment
- 16.6.9 Maintenance payments
- 16.6.10 Capital allowances & losses
- 16.6.11 Relief for allowances / losses
- 16.6.12 Loss relief against total income
- 16.6.13 Balancing allowances and charges
- 16.6.14 Deemed losses
- 16.6.15 Impact on relevant earnings
- 16.6.16 Example
- 16.7 Relief for PRSA Contributions
- 16.8 Tax relief on OPS Contributions
- 16.8.1 Earnings
- 16.8.2 Employee special contributions
- 16.8.3 Tax relief on Employee Special Contributions
- 16.8.4 Spreading of relief
- 16.8.5 Example
- 16.8.6 Spread back of relief
- 16.8.7 Additional restrictions on employee OPS contributions
- 16.8.8 Net pay arrangement for OPS
- 16.8.9 Periods of absence
- 16.8.10 Re-admittance
- 16.8.11 Salary Sacrifice
- 16.8.12 Contributions after NRA
- 16.8.13 Integration between PRSA contracts, Personal Pensions and Occupation Pension Schemes
- 16.9 Future Developments
- 16.10 Further Reading
- Chapter 17 Tax Treatment of Employer Contributions to OPS
- 17.1 Overview of Chapter
- 17.2 Recent Developments
- 17.3 Tax Deduction
- 17.4 Employer Contributions
- 17.5 Maximum Approvable Contributions
- 17.5.1 Calculation formulae
- 17.5.2 Example 1 - Retained benefits
- 17.5.3 Example 2 - Retained benefits
- 17.5.4 Example 3 - Retained benefits
- 17.5.5 Impact of limits
- 17.5.6 Defined benefits
- 17.6 Tax Relief for Employer Ordinary Contribution
- 17.7 Employer Special Contributions
- 17.7.1 Example - Employer special contribution
- 17.7.2 Spreading of relief
- 17.7.3 Example 1 - Spreading tax relief
- 17.7.4 Example 2 - Spreading tax relief
- 17.7.5 Example 3 - Spreading tax relief
- 17.7.6 Example 4- Spreading tax relief
- 17.7.7 Second special contribution
- 17.7.8 Example 1 - Second special contribution
- 17.7.9 Example 2 - Second special contribution
- 17.7.10 Accounting period
- 17.7.11 Example - Short accounting period
- 17.8 Special Cases
- 17.8.1 One man arrangements and earmarked policies
- 17.8.2 Example
- 17.8.3 Non-retirement benefit expenditure
- 17.8.4 Hancock annuities and certain special contributions
- 17.8.5 Backdating
- 17.9 Refund
- 17.10 Further Reading
- Chapter 18 Taxation of Funds and Benefits
- 18.1 Overview of Chapter
- 18.2 Recent Developments
- 18.3 Pensions Levy
- 18.3.1 Application of the levy
- 18.3.2 Excluded assets
- 18.3.3 Example - Foreign service exemption
- 18.3.4 Administration and payment of the levy
- 18.3.5 Chargeable amount
- 18.3.6 Geared assets
- 18.3.7 Valuation date
- 18.3.8 Example - Levy valuation date
- 18.3.9 Payment date
- 18.3.10 Chargeable person
- 18.3.11 Example - Scheme with insured assets
- 18.3.12 Impact on benefits
- 18.3.13 Pensioners affected
- 18.3.14 Pension funds in deficit
- 18.3.15 Example - DB scheme in deficit
- 18.4 Taxation Exemptions for Pension Scheme Investments
- 18.4.1 Tax exemption provisions
- 18.4.2 Non principal private residence (NPPR) charge
- 18.4.3 Exemption from NPPR
- 18.4.4 Household charge
- 18.4.5 Waivers and exemptions
- 18.4.6 Local Property Tax
- 18.4.7 Exemptions from LPT
- 18.4.8 Foreign taxes
- 18.4.9 Revenue rules for pension investments
- 18.4.10 Life office pension business
- 18.4.11 Annuities
- 18.5 Surpluses
- 18.5.1 Types of surplus
- 18.5.2 Funding surpluses
- 18.5.3 Funding surpluses revenue practice
- 18.5.4 Transfers and refunds
- 18.5.5 Example - Refund of contributions
- 18.5.6 AVCs
- 18.5.7 Buy Out Bonds
- 18.5.8 Taxation of refunds of surpluses
- 18.5.9 Asset stripping
- 18.6 Taxation of Benefits
- 18.6.1 Lump sum benefits
- 18.6.2 Excess fund tax
- 18.6.3 Benefit crystallisation event
- 18.6.4 Chargeable excess
- 18.6.5 Example 1 - Chargeable excess
- 18.6.6 Example 2 - Chargeable excess
- 18.6.7 Personal fund threshold
- 18.6.8 Administration of the excess fund tax
- 18.6.9 Credit for tax on excess lump sum
- 18.6.10 Example - Credit for lump sum tax
- 18.6.11 Valuation of defined benefits
- 18.6.12 Example - DB valuation
- 18.6.13 Payment of tax due on a chargeable excess
- 18.6.14 Anti-avoidance
- 18.6.15 Example - Exceptional pension increase
- 18.6.16 Annuities
- 18.6.17 Tax on draw downs from an ARF
- 18.7 Capital Acquisitions Tax
- 18.8 Further Reading
- Chapter 19 Investments
- 19.2 Introduction
- 19.3 Prudential Investment Rules
- 19.4 IORPs Directive
- 19.4.1 Implementation into Irish Law
- 19.4.2 Application of the IORPs Directive
- 19.4.3 Exemption from the IORPs Directive
- 19.4.4 One-Member arrangements
- 19.4.5 Small self-administered pension schemes
- 19.4.6 Multi-Member arrangements
- 19.4.7 Trust RACs
- 19.4.8 Obligations under the IORPs Directive
- 19.4.9 Predominantly on regulated markets
- 19.4.10 Borrowing
- 19.4.11 Practical issues
- 19.8 Deemed Payment Rules
- 19.8.1 Transactions
- 19.8.2 Loans to the scheme member
- 19.8.3 Example
- 19.8.4 Acquisition of property from the scheme member
- 19.8.5 Sale of property to scheme member
- 19.8.6 Holiday property and residences
- 19.8.7 Acquisition of shares
- 19.8.8 Tangible moveable property
- 19.8.9 Acquisition of business property
- 19.8.10 Connected person
- 19.8.11 Income tax charge
- 19.8.12 Removal from Scheme/ARF/PRSA
- 19.8.13 Revenue discretion
- Chapter 20 Withdrawal from Service
- 20.1 Overview of Chapter
- 20.2 Recent Developments
- 20.3 Introduction
- 20.3.1 The Pensions Act & Preserved benefits
- 20.3.2 Qualifying service
- 20.3.3 Example
- 20.3.4 Effect of preserved benefits
- 20.3.5 Vested rights
- 20.4 Refund of Contributions
- 20.4.1 Example 1
- 20.4.2 Example 2
- 20.4.3 Example 3
- 20.4.4 Tax on refunds
- 20.4.5 Foreign employments
- 20.4.6 Example
- 20.4.7 20% directors
- 20.4.8 Example
- 20.4.9 Mixed benefits
- 20.4.10 Mixed benefits under the Pensions Act
- 20.4.11 Example 1
- 20.4.12 Example 2
- 20.4.13 Mixed benefits and transfers
- 20.4.14 Example 1
- 20.4.15 Example 2
- 20.4.16 Non-contributory schemes and mixed benefits
- 20.4.17 Effect of refund
- 20.4.18 AVCs
- 20.4.19 Multi-employer schemes
- 20.4.20 Example
- 20.4.21 Repayment
- 20.4.22 Family law act benefits
- 20.5 Deferred Pensions
- 20.5.1 Maximum deferred benefit
- 20.5.2 Increases
- 20.5.3 Commencement
- 20.5.4 Post NRA increases
- 20.5.5 Lump sums
- 20.5.6 Lump sum increases
- 20.5.7 Death
- 20.5.8 Example
- 20.5.9 Pensions
- 20.5.10 Staying in service
- 20.6 Transfer Payments
- 20.6.1 Amount of transfer payment
- 20.6.2 Maximum pension payable by new scheme
- 20.6.3 Lump sum benefit payable by new scheme
- 20.6.4 Example
- 20.6.5 Added years
- 20.6.6 Example
- 20.6.7 Death benefit
- 20.6.8 Example
- 20.6.9 Advantages of a transfer payment
- 20.6.10 Disadvantages of a transfer payment
- 20.7 Transfers to Overseas Arrangements
- 20.8 Transfers to Personal Pensions & PRSAs
- 20.9 Split Transfers
- 20.10 Block Transfers
- 20.11 Family Law Acts Transfers
- 20.11.1 Buy out bonds
- 20.11.2 Refund of contributions
- 20.11.3 Multiple bonds
- 20.11.4 The “ARF option” and Buy-Out-Bonds
- 20.12 The Future for Options on Withdrawing from Service
- 20.13 Further Reading
- Chapter 21 Traditional Benefit Options at Retirement for Personal Pensions and Prsas
- 21.1 Overview of Chapter
- 21.2 Recent Developments
- 21.3 Traditional Benefits
- 21.4 Retirement Benefits for Personal Pensions
- 21.4.1 Lump sum
- 21.4.2 Annuities from personal pensions
- 21.4.3 Early retirement for personal pensions
- 21.5 Retirement benefits for PRSAs
- 21.6 Types of annuities for personal pensions and PRSA
- 21.6.1 Increases in payment
- 21.6.2 Ill-health annuity
- 21.6.3 Spouses annuity
- 21.6.4 Dependants
- 21.6.5 Death and exceptional ill health lump sums
- 21.7 Conclusion
- 21.8 Further Reading
- Chapter 22 Calculation of Retirement Benefits for Occupational Pension Schemes
- 22.1 Overview of Chapter
- 22.2 Recent Developments
- 22.3 Introduction
- 22.4 Final Remuneration Defined
- 22.4.1 Discretionary approval and final remuneration
- 22.4.2 Twelve month pay
- 22.4.3 Example 1: 12 month pay mechanism
- 22.4.4 Example 2: 12 month pay mechanism
- 22.4.5 Three year average
- 22.4.6 Example 1: 3 or more consecutive year average mechanism
- 22.4.7 Example 2: 3 or more consecutive year average mechanism with dynamisation
- 22.4.8 Rate of pay
- 22.4.9 Example 1: 12 month rate of pay mechanism
- 22.4.10 Example 2: 12 month of pay mechanism
- 22.4.11 20% Directors
- 22.4.12 Example: final remuneration for 20% Director
- 22.4.13 Sick pay and final remuneration
- 22.4.14 Example
- 22.4.15 Part-Time employees and final remuneration
- 22.4.16 Separate calculations for full-time and part-time service
- 22.4.17 Conversion of part-time service to full-time service
- 22.4.18 Example
- 22.4.19 Pensions and share schemes
- 22.5 Normal Retirement Age (NRA)
- 22.6 Retirement Benefits
- 22.6.1 Aggregate retirement benefits in same employment
- 22.6.2 Retained benefits from previous employment/self employment
- 22.6.3 Retained benefit exception - concurrent benefits
- 22.6.4 Example 1
- 22.6.5 Example 2
- 22.6.6 Retained benefit exceptions
- 22.6.7 Non-pensionable employment and retained benefits
- 22.6.8 Maximum pension
- 22.6.9 Lump sums
- 22.6.10 Benefits in payment
- 22.6.11 Example
- 22.6.12 Uplifted Scale
- 22.6.13 Type of pension
- 22.7 Pension Increases
- 22.8 Maximum Pension - Other Factors
- 22.8.1 Life cover after retirement - maximum benefits
- 22.8.2 Example - life cover after retirement
- 22.8.3 Service - maximum benefits
- 22.8.4 No remuneration - service - maximum benefits
- 22.8.5 Example - no remuneration
- 22.8.6 Spouse’s service - no remuneration - maximum benefits
- 22.8.7 Investment companies - service - maximum benefits
- 22.8.8 Groups of companies - service - maximum benefits
- 22.8.9 Transfer of businesses - service - maximum
- 22.8.10 Previous expectations - service - maximum benefits
- 22.8.11 Example 1 - previous expectations
- 22.8.12 Example 2 - previous expectations
- 22.8.13 Example 3 - previous expectations
- 22.8.14 Part-time employment - service - maximum benefits
- 22.8.15 Example 1 - separate service method
- 22.8.16 Example 2 - converted service method
- 22.8.17 Self employed “service”- service - maximum benefits
- 22.9 Lump Sum Benefits
- 22.9.1 Maximum lump sum
- 22.9.2 Strict basis - maximum lump sum
- 22.9.3 Uplifted scale
- 22.9.4 Effect of lump sum
- 22.9.5 Commutation factors
- 22.9.6 Example 1 - commutation factors
- 22.9.7 Example 2 - commutation factors
- 22.9.8 Personal fund threshold
- 22.9.9 Full commutation and trivial pensions
- 22.10 Late Retirement
- 22.10.1 NRA adjustment
- 22.10.2 Additional benefits
- 22.10.3 Final remuneration
- 22.10.4 Example - late retirement options
- 22.10.5 Restrictions on 20% Directors
- 22.10.6 Example -20% Director - late retirement
- 22.10.7 Commencement of benefit
- 22.10.8 Interaction with ARF option
- 22.10.9 Lump sums payment options
- 22.11 Early Retirement
- 22.11.1 Benefit restrictions
- 22.11.2 Example - early retirement benefit calculation
- 22.11.3 Lump sums
- 22.11.4 Additional restrictions
- 22.11.5 Bridging pensions
- 22.12 Further Reading
- Chapter 23 Death and Disability Benefits
- 23.1 Overview of Chapter
- 23.2 Recent Developments
- 23.3 Introduction
- 23.4 Ill Health Benefits under an OPS
- 23.4.1 Lump sums
- 23.4.2 Defined contribution schemes
- 23.4.3 Definition of ill health
- 23.4.4 Levels of ill health
- 23.5 Exceptional ill health
- 23.5.1 Amount of benefit
- 23.5.2 Calculation of the tax
- 23.5.3 Example 1
- 23.5.4 Example 2
- 23.5.5 Example 3
- 23.5.6 The ARF regime
- 23.6 Death in Service
- 23.6.1 Lump sum benefits
- 23.6.2 Example 1
- 23.6.3 Example 2
- 23.6.4 Pension benefits
- 23.6.5 Dependants
- 23.6.6 Retained benefits
- 23.6.7 Example
- 23.6.8 20% Directors
- 23.6.9 Funding
- 23.6.10 Preserved benefits
- 23.6.11 Example
- 23.6.12 Death after normal retirement age (NRA)
- 23.6.13 Example
- 23.7 Death in Retirement
- 23.7.1 Lump sum benefits
- 23.7.2 Spouses and dependants pension
- 23.7.3 Example
- 23.7.4 Effect of commutation
- 23.7.5 Cessation
- 23.7.6 Allocated benefits
- 23.7.7 Example
- 23.7.8 Alternative guarantee
- 23.7.9 Example
- 23.7.10 Guarantees
- 23.8 ARFs on Death
- 23.9 PRSAs on Death
- 23.10 Permanent Health Insurance (PHI)
- 23.10.1 Commercial structure of PHI contracts
- 23.10.2 Approved schemes
- 23.10.3 Taxation of approved scheme benefits
- 23.10.4 Other arrangements
- 23.10.5 Interaction with pension arrangements
- 23.11 Further Reading
- Chapter 24 Special Cases
- 24.1 Overview of Chapter
- 24.2 Proprietary Directors
- 24.2.1 Definition of 20% Director and 5% Director
- 24.2.2 Example
- 24.2.3 Directorship test
- 24.2.4 Example 1
- 24.2.5 Example 2
- 24.2.6 Shareholding test
- 24.2.7 Own shares
- 24.2.8 Relevant time period
- 24.2.9 Additional shareholding
- 24.2.10 Example
- 24.2.11 Relevant company
- 24.2.12 Type and quantity of shares
- 24.2.13 Relevance of 5% and 20% Directors
- 24.2.14 Restrictions on 20% Directors
- Chapter 25 Pension Adjustment Orders
- 25.1 Overview of Chapter
- 25.2 Recent Developments
- 25.3 Introduction
- 25.4 Background to Pension Adjustment Orders
- 25.6 Drafting of a Pension Adjustment Order
- 25.7 Key Points to Consider with Pension Adjustment Orders
- 25.10 Death of Beneficiaries
- 25.10.1 Death of the dependent spouse whilst the member spouse is in service
- 25.10.2 Death of the non-member spouse whilst the member spouse is in retirement
- 25.10.3 Death of the dependent member of the family
- 25.10.4 Death of the member spouse in service
- 25.10.5 Death of the member spouse in retirement
- 25.10.6 Withdrawal of the member spouse from the scheme prior to commencement of benefits