Additional information about Pension Fund Levy
What is the Pension Fund Levy?
The Pension Fund Levy is a government imposed 0.6% stamp duty levy on pension funds to be applied each year for the next 4 years.
What pension products will be covered by the Pension Fund Levy?
The stamp duty levy of 0.6% will be applied to funds under management in:
- Occupational Pension Schemes
- Personal Retirement Bonds
- Personal Retirement Savings Plan (PRSAs)
- Personal Pensions
- Investment policies held by Pension Schemes*.
Are there any pension products excluded from the Pension Fund Levy?
The stamp duty levy will not apply to:
- the assets of occupational pension funds in respect of the provision of retirement benefi ts to non-resident members
- the remaining assets held under a PRSA where a cash lump sum has already been taken (a vested PRSA)
- pension funds that have already passed a resolution to wind-up a pension scheme and where the sponsoring employer is insolvent as at 30th June each year.
Why is the Government imposing this levy?
The levy was introduced as a means of funding the Jobs Initiative introduced by the Government on the 10th May 2011. This initiative sets out measures intended to promote job creation.
When does the Levy come into effect?
The stamp duty levy is payable under the Finance (No. 2) Act 2011, which was signed into law by the President on 22nd June 2011.
When will the Levy be deducted and paid?
Under the Finance (No. 2) Act 2011, the valuation date for determining the market value of the assets in your pension fund is 30th June for each of the years 2011, 2012, 2013 and 2014. Friends First will deduct the levy on or as soon as practical after 30th June for each of these years and make the required payment to the Revenue.
Do Friends First customers need to do anything?
No, Friends First will automatically take the stamp duty levy from customers’ policies from early July.
* This includes policies that form part of a small Self-Administered Scheme (other than ARF)
