There are no provisions in the Overseas Transfer Regulations for Personal Pensions. However, there Personal Retirement Savings Accounts are included in the regulations. A Personal Pension can be transferred to a PRSA under Irish transfer rules. By transferring your Personal Retirement Savings Account to an Overseas Trustee, you can take advantage of the following benefits:
Access 30% of your Pension from Age 50:
As an EU citizen, you are entitled to open a pension plan in another European Country and transfer your existing retirement benefits to this scheme. In certain EU judisdictions you can access up to 30% of the transfer fund as a Pension Commencement Lump Sum from Age 50.
Once the funds are remitted back to Ireland, they are treated as a capital payment and subject to the same tax free limits that apply to Irish pensions. The balance of funds remain invested in the trust with future drawdown taxes as income.
No requirement to purchase annuity:
Due to decreased bond yields and increased longevity, Annuity rates are not what they once were. Some jurisdictions such as Malta do not require the beneficiary to purchase an annuity following a Pension Commencement Lump Sum (up to 30%). The balance remains in the scheme and can be invested, drawn down or both. Withdrawals from the scheme can commence at age 50 and must commence by age 70.
No requirement to purchase an ARF and therefore no AMRF requirement (currently €63,500):
Some Irish retirement funds require the holder to lock €63,500 away until age 75. This amount is due to increase to €119,800 in the Finance Act 2016. Some International Pension jurisdictions such as Malta do not require the member to purchase a post retirement product (such as an ARF) there is no requirement to lock the funds away until age 75.
Extremely wide Investment Choice:
One of the biggest advantages to an International Pension is the investment flexibility. You can now have access to International Fund Managers and Global Investment Funds. You can also appoint an investment advisor to make the decisions with you. The scheme trustees will ensure that the scheme investments are properly managed.
Fund Value can be passed to spouse or estate on death:
Under the rules of some International Pensions, the fund value on upon death forms part of the estate of the deceased. Where the deceased or beneficiary are resident in Ireland, Irish Inheritance Tax will apply. In Ireland, inheritance is completely exempt between spouses.
Increased Prudential Security
By holding your funds with an International Trustee, you can designate your own investment managers. This may have a positive effect on the counterparty risks and the prudential security.