Getting the most out of working in Ireland

Just to clarify regarding tax relief available on Pension Contributions:

Tax relief is on PAYE (Income Tax), and in many instances on PRSI also.
So if you pay tax at the higher rate (41%) and you make a €250 contribution per month - once PAYE Tax relief is taken into consideration - your Net contribution is €147.50 per month.  So, a €250 investment in your retirement only costs you €147.50.

If you pay tax at the lower rate (20%) and you make a €250 contribution per month - once PAYE Tax relief is taken into consideration - your Net contribution is €200.  So, a €250 investment in your retirement only costs you €200.

In some instances tax relief will also be available on your PRSI.  This will depend on the specific circumstances of your employment.  It is not as great a relief as on your PAYE (income tax), but it is a great benefit also.

I hope this helps : )

Yes, there is a cap (limit), on the amount of contributions you can make!

The maximum allowable (to claim tax relief) depends on your income and your age.  However, the limits are quite generous.  At worst, you can claim tax relief on contributions (payments) not exceeding 15% of your earned income.  This increases to 40% as you approach your retirement.

Different rules will apply if you are the director of your own company.

Your Financial Advisor will tell you the most appropriate structure for your retirement plan (and in most instances will not charge you for the consultation).

Income Protection for Self Employed People - what income will you have to live on if you are unable to work when you are sick?
Self Employed people can claim Tax Relief on Premiums paid toward Income Protection Policies.  This is vital as self employed people tend not to make PRSI (social welfare) contributions and are not eligible for the range of benefits from the State which employed people are(employed people will always pay the PRSI tax).

So, two things to remember:
1. Self Employed people need to put their own protection in place in case they are unable to work due to ill health.  Otherwise there will be no income coming in.
2. Tax Relief is available on the cost of putting an Income Protection Policy in place.

To find out how to put this in place contact your Financial Advisor who, in most cases will advise you free of charge.  A good Financial Advisor will help you assess what Protection you need (if any), and can help with a range of other areas.

You can find a Financial Advisor by contacting:
-Life Companies (such as Canada Life, where I work)
-Banks
-Insurance Brokers
Feel free to send me a mail.