Pension plan tax benefits.

troyzer

Hi all!

I'm a recent graduate and I've only been working for less than a year. I've got my fingers in different investment pies already just for my own personal savings but I'm wondering how to plan my pension going forward.

I work in an industry which will see me probably working all over the world. I'm 24 and I've already worked and paid taxes in two different countries. My long term plan is to try and settle down in Canada but it's clear that a significant portion of my career will also be in Ireland (I'm in Australia at the moment too just to confuse things).

I have a broad understanding of the tax benefits of a PRSA and the Canadian equivalent (RRSP). What I want to know is how do I sort out my pension pot in such a way that I can still avail of tax benefits? 

For example, I'm moving back to Ireland in a few weeks where I plan to work for two years until I move to Canada. In those two years, I'll want to start putting money into a pension pot. But when I move to Canada, what happens? Do I have to start a new pension pot there? Can I move my PRSA over to a RRSP? Can I still contribute to my PRSA? Do I lose tax benefits?

Are PRSAs and their equivalent poorly equipped for someone like me who will move around a lot or is there a way around it?

CIARAN_BOYLE

First off a pension fund isn't necessarily a prsa. Don't assume you need a prsa if you want a pension of the fees are higher.

Secondly there is definitely a way to transfer pensions between jurisdictions. The regulations differ between different countries and have to be met. I used to share office space with a pension broker who would deal with it occasionally.

It's best to have a conversation with a professional who deals with the matter regularly. Also some funds may not allow transfers due to fund rules.

troyzer

CIARAN_BOYLE wrote: »

First off a pension fund isn't necessarily a prsa. Don't assume you need a prsa if you want a pension of the fees are higher.

Secondly there is definitely a way to transfer pensions between jurisdictions. The regulations differ between different countries and have to be met. I used to share office space with a pension broker who would deal with it occasionally.

It's best to have a conversation with a professional who deals with the matter regularly. Also some funds may not allow transfers due to fund rules.

The plan was to go and see a fiduciary anyway. Of course I'm not going to make a decision unless I'm handing money over for advice. I was just curious to get a general background. I assume it would be possible but I don't know how complex it is.

CIARAN_BOYLE

troyzer wrote: »

The plan was to go and see a fiduciary anyway. Of course I'm not going to make a decision unless I'm handing money over for advice. I was just curious to get a general background. I assume it would be possible but I don't know how complex it is.

You might want to furnish the advisor with a list of countries you are interested in working in so he can research specific rules.

I know to transfer from a UK pension fund to an Irish one you need to see an independent advisor in the UK who has to certify that he fully informed you of your options.

troyzer

CIARAN_BOYLE wrote: »

troyzer wrote: »

The plan was to go and see a fiduciary anyway. Of course I'm not going to make a decision unless I'm handing money over for advice. I was just curious to get a general background. I assume it would be possible but I don't know how complex it is.

You might want to furnish the advisor with a list of countries you are interested in working in so he can research specific rules.

I know to transfer from a UK pension fund to an Irish one you need to see an independent advisor in the UK who has to certify that he fully informed you of your options.

That doesn't seem like too much of a barrier given the long term nature of a pension. At least it's possible then. What I was really worried about was being in a situation where I'd either have to have multiple pension pots in every country I've ever worked in (which surely has massive implications) or have one pension pot in one country but not get tax benefits when I'm not working in that country.

Henry Ford III

CIARAN_BOYLE wrote: »

...I know to transfer from a UK pension fund to an Irish one you need to see an independent advisor in the UK who has to certify that he fully informed you of your options.

No you don't. I've done plenty of such transfers over the years btw.

CIARAN_BOYLE

Henry Ford III wrote: »

No you don't. I've done plenty of such transfers over the years btw.

Might be scheme based rather than country based or something.

I'm not an expert but I shared office space with a pensions broker for 3 years and he had a client looking to transfer a UK scheme into an Irish one and that was required.

Hani Kosti

Henry Ford III wrote:

No you don't. I've done plenty of such transfers over the years btw.

Yes you most certainly do. I worked on transfers only for over 3 years, you need an IFA in order to transfer to (Q)ROPS approved plan