A personal pension is a private pension plan managed for you by a life assurance or investment company.
Your retirement options
Most pensions allow you to take a certain amount of your pension fund as a lump sum (usually tax free). The maximum lump sum that you are allowed to take from a personal pension is 25% of your fund at retirement:
- Up to €200,000 of this is tax free (this is the total of all lump sums taken from your pension(s) since December 2005).
- Amounts between €200,000 and €500,000 will be taxed at the standard rate, currently 20%.
- Amounts over €500,000 are subject to your current tax rate and Universal Social Charge (USC).
Annuity or Approved Retirement Fund
You can use the rest of your retirement fund to buy either:
- an annuity – a pension for life, or
- an Approved Retirement Fund (ARF) – an ongoing investment.
If you have more than one pension plan, you can opt for a combination of an annuity and ARF.
When can I retire?
With a personal pension you can retire at any time between age 60 and 75. You may be able to retire early (before the age of 60) for reasons of serious ill health or from certain specified occupations.
How do I take my pension benefits?
We will send you your retirement papers. They will show you the options available to you as well as giving you an up-to-date valuation on your retirement fund with Friends First.
Your retirement papers need to be completed, signed and returned to us with any accompanying documents.
What accompanying documents do I need?
There are certain documents you will need to send us with your retirement papers so we can complete your retirement claim.
Your original policy or Lost Policy Declaration & Indemnity Form
We need your original policy schedule to process a claim on your pension. If you have lost this document, you should fill in the Lost Policy and Indemnity Form included in your retirement papers; this must be witnessed by a third party who is not a relative.
Proof of identification
We need your original birth certificate or passport or a certified copy of either. This is to protect you against a possible fraudulent claim on your pension.
Form of Indemnity – tax-free lump sum on retirement
There is a limit since December 2015 of €200,000 that you can take as a tax-free lump sum from one or more pension plans. On this form, you must declare any sum you have previously taken so we can deduct the correct tax from the lump sum you are taking on your retirement.
Declaration of previous retirement benefits
Also known as a Benefit Crystallisation Event Declaration. You need to fill in this form to declare all retirement benefits you may have previously taken or have transferred overseas. This ensures that you don’t exceed the maximum Revenue benefit limits.
Your PPS Number (previously called RSI Number)
You will find this on any correspondence from the Revenue or on your payslip.
Tax Credit Certificate
This is needed if you are setting up an annuity with Friends First. The Revenue will issue you with a Tax Credit Certificate that sets out in detail the amount of tax credits you receive and your standard rate cut-off point.
Marriage certificate or civil partnership registration form
This is in the case of a joint life annuity. If you don’t have the original, you can send us a certified copy.
Talk to your Financial Broker
We strongly recommend that you talk to your Financial Broker when you are making decisions about your retirement benefits.