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Using a pension to lower investment tax bill?

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  • 13-11-2017 9:49am
    #1
    mrcheez
    Registered Users Posts: 13,646 ✭✭✭✭


    I had to sell off my Rabodirect managed funds this year so will be hit with a nasty tax bill next year.

    If I setup a pension before the end of the year and pay a lump sum into it does that help reduce the overall tax bill for these?


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    #2
    homer911
    Registered Users Posts: 5,113 ✭✭✭homer911


    No. Tax on profits on sale of Managed Funds is effectively ring fenced to my knowledge


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    #3
    mrcheez
    Registered Users Posts: 13,646 ✭✭✭✭mrcheez


    homer911 wrote: »
    No. Tax on profits on sale of Managed Funds is effectively ring fenced to my knowledge

    Actually would there be a benefit regarding my PAYE tax that I've already paid this year if I paid a lump sum into a pension? Would I get something back?

    Perhaps some sort of tax rebate might ease the pain of next years bill.

    I had planned on setting up the pension in Jan/Feb as I have more urgent matters to attend to but might prioritise it this year if it helps the 2017 tax bill I pay next year.


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    #4
    Cute Hoor
    Registered Users Posts: 1,788 ✭✭✭Cute Hoor


    mrcheez wrote: »
    Actually would there be a benefit regarding my PAYE tax that I've already paid this year if I paid a lump sum into a pension? Would I get something back?

    Perhaps some sort of tax rebate might ease the pain of next years bill.

    I had planned on setting up the pension in Jan/Feb as I have more urgent matters to attend to but might prioritise it this year if it helps the 2017 tax bill I pay next year.

    Any money invested in a pension in 2017 would entitle you to a refund of the tax on that money.

    The age-related earnings percentage limits are:
    under 30: 15%
    30-39: 20%
    40-49: 25%
    50-54: 30%
    55-59: 35%
    60 or over: 40%.

    Probably only makes sense if you are paying top rate of tax


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    #5
    mrcheez
    Registered Users Posts: 13,646 ✭✭✭✭mrcheez


    Cute Hoor wrote: »
    Any money invested in a pension in 2017 would entitle you to a refund of the tax on that money.

    The age-related earnings percentage limits are:
    under 30: 15%
    30-39: 20%
    40-49: 25%
    50-54: 30%
    55-59: 35%
    60 or over: 40%.

    Probably only makes sense if you are paying top rate of tax

    Aye paying top rate alright... I'll investigate this pension malarky for 2017 then.

    Just to get a head start any recommendations on schemes to check out that follow the markets? Perhaps i should take this to a pensions forum.


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