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Once off pension contribution after the end of tax year.

  • 30-01-2018 1:42pm
    #1
    gamblor101
    Registered Users, Registered Users 2 Posts: 158 ✭✭


    Hello,

    I've got myself a little confused. Probably over thinking it but could some one take a look at the following hypothetical.

    Age 42
    Gross Salary - 50000
    Pension tax free - 25% = 12500
    Contributions to employer scheme - 2500

    I can put an additional 10000 into an AVC/PRSA tax free.

    My question is do I put in 10000 or 5900 of taxed income to get a tax credit of 4100?


Comments

  • #2
    coylemj
    Registered Users, Registered Users 2 Posts: 25,621 ✭✭✭✭coylemj


    You put in 10,000. Whatever you put in is considered to come out of your gross income even though the money will obviously be coming out of your net (taxed) income. For an AVC you have until Oct 31st the following year to do it in respect of the current year, not sure about a PRSA.


  • #3
    daheff
    Registered Users, Registered Users 2 Posts: 5,933 ✭✭✭daheff


    isn't it that you put in the gross amount, then claim the taxable benefit back from revenue, so end up out of pocket by the net amount?


  • #4
    The J Stands for Jay
    Registered Users, Registered Users 2 Posts: 5,876 ✭✭✭The J Stands for Jay


    daheff wrote: »
    isn't it that you put in the gross amount, then claim the taxable benefit back from revenue, so end up out of pocket by the net amount?

    Of you write a cheque to the pension fund, you'll claim the tax back from revenue. If you're paying through your employer's payroll (usually only done for regular monthly amounts), then the amount you pay to the pension is taken from your gross salary before any tax is calculated.


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