Seán Fleming
Question:90. Deputy Sean Fleming asked the Minister for Finance to respond to correspondence (details supplied); and if he will make a statement on the matter. [42062/24]
View answerWednesday, 16 October 2024
Questions (90)
Written answers
I am advised by Revenue that the earliest at which an individual can take retirement benefits is usually age 60 years. However, the terms of a retirement benefit scheme or pension product may provide that an individual can retire and take benefits from age 50 years. This is provided for in section 772(3)(a) and (4)(b)(ii) Taxes Consolidation Act 1997 (TCA) for occupational pension schemes, section 784(2)(iii)(II) and (3)(c) TCA for Retirement Annuity Contracts (RACs) and section 787K(1)(c)(ii) and (2)(b) and (c) TCA for Personal Retirement Savings Accounts (PRSAs).
The scheme or product may provide for the payment of a lump sum of 25% of overall funds (section 772(3B)(b) for members of occupational pension schemes who can avail of the Approved Retirement Fund (ARF) option, section 784(2)(b) for RAC holders and section 787G(3)(a) for PRSA holders). Members of occupational pension schemes who do not have or do not avail of the ARF option can take a lump sum of up to 1.5 times final salary, depending on the individual’s service (section 772(3)(f) TCA).
The Deputy may be aware that the Report of the Interdepartmental Pensions Reform and Taxation Group (IDPRTG) was published in late 2020. The report set out a number of proposals to aid in the harmonisation and simplification of supplemental pensions. including:
“The lower age limit at which savers can access retirement benefits should be increased to 55. Consideration should be given to providing for a lead-in period to allow those retiring early in the shorter term to do so”.
While a number of the other proposals relating to taxation have been implemented since the publication of the Report, further proposals from the 2020 Report are currently being worked on as part of the 2025 work plan, some of which are technical in nature and others which have wider policy implications necessitating careful consideration through the normal policy channels. The Group continues its work to bring about further reforms of the supplemental pension landscape.