Timetable for submission of funding proposals

Wednesday 13 May 2009: Last September, The Pensions Board granted a six month extension to the deadline for defined benefit schemes to submit funding proposals for approval. For some schemes, this extended period expires at the end of June, 2009.

In April, the 2009 Social Welfare and Pensions Act introduced a number of changes to the 1990 Pensions Act. In order to allow pension scheme trustees to consider the effect of these changes and to discuss them with their sponsoring employers The Pensions Board has decided to further extend the deadline for defined benefit schemes to submit funding proposals for approval. The details of the further extension are as follows:

  1. The extension applies to schemes which had a negative Actuarial Statement with an effective date between 31 December 2007 and 31 December 2008 inclusive, or require a funding proposal because of an Actuarial Funding Certificate with an effective date between 31 December 2007 and 31 December 2008 inclusive.
  2. For these schemes, funding proposals must be submitted within two years of the effective date of the Statement or Certificate in point 1 above. (For schemes with both a Statement and a Certificate with effective date in the time period specified in 1, funding proposals must be submitted within two years of the earlier date.)
  3. Trustees who fail to make a submission in time may be liable to prosecution.
  4. No extension is being granted to the deadline for the submission of actuarial funding certificates due to be filed with the Board.

The Pensions Board will shortly publish guidelines for the submission of section 50 or 50A applications. The Board will also announce details of a series of countrywide seminars for trustees, employers, unions and pension advisers to advise on funding issues.

 
 
Pensions Board
Pensions Board - Engage with your Pension

About the Pension’s Calculator

  • This pension’s calculator is designed to give a broad indication of the level of contributions required to give your desired pension at your retirement age. This calculator only provides a sample indication of the funding contributions for your pension and no reliance should be placed on it.
  • This calculator does not take into account any contributions an employer might make to your pension.
  • Do you know that contributions paid to a pension scheme will benefit from income tax relief at your highest rate of income tax? This calculator takes into account current income tax relief benefits.
  • For a full and accurate assessment of your personal finances and any tax relief you may be entitled to on your pension contributions always consult with a professional financial adviser

The next step is to talk to your employer, trade union, bank, insurance company, building society or financial advisor about starting your pension today.

Pension Calculator Notes:
  1. Assumptions used: Investment return will be 5% per year before retirement and 4% per year after retirement. Salary will increase at 3% per year. Pension will increase at 2% per year in retirement. The State Pension will increase in line with salary increases. Spouse's annuity assumes a 3 year age gap between the Main Life and Spouse. Your personal illustration above makes an approximate allowance for the recently introduced Pensions Levy (i.e. 0.6% of your Fund Value) until 2014 or your intended retirement year if earlier.
  2. Contribution amounts shown will increase each year as salary increases.
  3. The actual pension at retirement will depend on actual investment return and salary inflation up to retirement and on the cost of purchasing annuities at retirement.
  4. Tax relief calculations take account of age related limits on tax relief in any given year as prescribed by the Revenue. Your financial advisor will be able to help you to stay within your limits. The maximum tax relief as a % of earnings are as follows:
         Under 30: 15%
         30 to 39: 20%
         40 to 49: 25%
         50 to 54: 30%
         55 to 59: 35%
         60 and over: 40%
  5. Contributions or benefits may exceed limits prescribed by the Revenue. Your financial advisor will be able to help you to stay within your limits. Budget 2011, introduced a Standard Fund Threshold (SFT) of €2.3 million. Individuals with pension funds in excess of this value as at 7 December 2010 may apply for a Personal Fund Threshold(PFT). When the capital value of pension benefits drawn down by an individual exceed his or her SFT or PFT as appropriate, a tax charge of 41% is applied to the excess fund.
  6. In these net contribution calculations, PAYE & single persons tax reliefs and single persons tax bands are assumed. It is also assumed that no other tax reliefs apply.
  7. The annuity rate used to convert your pension fund at retirement age is a long term average annuity rate, which makes no allowance for the recent gender equalisation ruling. The annuity rate used in your personal illustration above will be shown when you run the calculator.
  8. This calculator takes account of the fact that the State Pension (Transition) will no longer be paid from 1 January 2014. This means that there will then be a standard State Pension age of 66 years for everyone. If you have qualified for the State Pension Transition before 1 January 2014 you remain entitled to it for the duration of your claim (1 year). State pension age will increase to 67 in 2021 and to 68 in 2028