Group PRSA’s (Group Personal Retirement Savings Account), now more than ever are an attractive alternative to Group Defined Contribution Schemes as a result of there being no employee BIK payable on employer contributions since 1st January 2016.
The removal of employer BIK on 01 January 2023 have made PRSA even more attractive because of massive potential funding capacity into PRSA now i.e. potentially up to the €2million pension cap.
- Group PRSAs are different from Group Pensions.
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Benefits of Group PRSA to the Employer:
- There is no trustee requirement for Group PRSA’s.
- The company can contribute tax efficiently for individual employees – 12.5% corporation tax benefit.
- Additional death in service or Income protection schemes can operate tax efficiently alongside a Group PRSA.
- There is no salary and service restriction based on contributions which apply to Master Trust arrangements. Contributions up to pension cap of €2million are realistic.
Benefits of Group PRSA to the Employee:
- The employee can make contributions and get tax relief, as per current revenue age related guidelines (between 15% – 40% of salary).
- The growth of the fund will be exempt from growth taxes.
- The fund can be accessed anytime from age 60 (from age 50 in case of early retirement via salary deduction group scheme).
- The full fund is payable to next of kin in event of death of PRSA holder before retirement.
How to Get Started
Do you want to know more about Group PRSAs? Follow the steps below to get started with Mark Cahill Financial Services.
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