Company Directors Pension

Company directors have the distinct advantage of being able to extract profits from their company and transfer into their own name free of income tax through the use of an executive pension plan.

An Executive Pension remains by far the most tax efficient way of saving for your retirement and extracting wealth from your business.

You have a window of oportunity now to save what you can and benefit from current generous tax reliefs. The early you begin your pension the greater the fund you will have in retirement. To estimate what's needed to provide you with a decent pension in retirement click on the retirement fund calculator.

Benefits of an Executive Pension Plan

  • Generous contributions allowable:
    • Company directors could pay 4x times their salary into an executive pension plan every year until retirement.
  • Protection from creditors:
    • Your pension fund pre retirement remains independent of your company. As a result no creditors can access this fund in the event of liqudation
  • Income Tax relief:
    • The ammount you contribute as an employee into your pension will be eligible for up to 41% tax relief. So a €10,000 contribution will in effect only cost you €5,100 (assuming you are a top rate tax payer)
  • Corporation Tax relief:
    • The ammount that the company contributes will result in a corporation tax saving of 12.5%
  • Tax free growth:
    • The money you contribute to your pension is allowed to grow tax free. For example - Your pension plan is not subject to DIRT or Capital Gains tax
  • Tax free lump sum in retirement:
    • You will be able to take up to 25% of your fund tax free or 1.5x times your final sallary from your pension fund when you retire.
  • Retaining full control of your fund when you retire:
    • You can use your pension fund to either purchase a pension or leave it invested to pass on to your family.

The age at which you can now qualify for the state pension is now 68. The loss of 3 years in state pension income could amount to almost €60,000 for a maried couple. The use of an executive pension can be used to offset this loss.