A Personal Pension is a pension that is solely owned by you and held in your name. This type of pension is most suitable for someone who is self-employed or a professional worker, taxed under schedule D Case I or II, or in a job with no pension taxed under Schedule E. While you can contribute to your Personal Pension an employer cannot contribute.
Depending on your level of income tax-relief on your contributions will either be at 20% or 40% relief.
|Age||Amount which qualifies for tax relief|
|Under 30 years||15% of net relevant earnings|
|30 to 39 years||20%|
|40 to 49 years||25%|
|50 to 54 years||30%|
|55 to 59 years||35%|
When you retire
Similar to a PRSA you can take 25% of your Personal Pension fund as a tax free lump sum up to a maximum of €200,000. The remainder of your PRSA fund can then be used to purchase an Annuity or invest in an Approved Retirement Fund.