Executive Pension

An Executive Pension is a pension set up a Ltd company for the directors of the company. The pension is set up under a trust, which is often provided for free. Both employers and employees can make contributions, although, in the case of business owners (including contractors), it’s much more tax advantageous for company monies to fully fund the plan.

executive-pension Pension Plans play-video
Executive Pension top-tips
Executive Pension

Pension Plans top-tips

  1. The average person retiring tomorrow aged 65 years has a life expectancy of between 20 years, that’s a significant amount of time to enjoy in retirement.
  2. It takes a long time to save for retirement and the earlier a person starts the better.
  3. Taking stock of your existing pension can reduce investment charges and allow greater control over your benefits come retirement.

Executive Pension – Business Owner Advantages

Executive Pension Plan – Key Highlights:

  • Can be entirely funded through company contributions.
  • Full corporation tax-relief.
  • No USC or PRSI on employer paid contributions.
  • No benefit in kind.
  • Your investment grows free of both capital gains tax and income tax.
  • 25% retirement lump sum.
  • Fund access from age 50 onwards.
  • It’s portable and can also accept transfer in from previous employer pensions.
  • Allows an owner director to ring-fence company money in their own name.

Pension Investment Videos

Starting an Executive Pension Plan

The Right Advice

There are several ways to best set up your Executive Pension Plan dependent on your individual circumstances. Our job is to provide the best pension advice, offering the broadest range of investment choices, with minimum cost aligned to your personal investment risk profile.

When arranging your pension plan you need to be fully aware of the underlying costs involved when also choosing the right investment assets and strategy to grow your pension fund over time.

At One Quote Financial Brokers, our advice based private executive pension plans also include:

  • Free Personal Consultation.
  • 24/7 Online Plan Access.
  • Annual Benefit Statements.
  • Free Trustee Services.

Executive Pension Asset Choice

Assessing your investment options

As a pensions broker, we compare the market for the best pension products and offer the broadest range of investment fund options that include ESG investing which incorporates environmental, social, and governance elements into the investment process.

Our investment recommendations can include (a) default lifestyle funds to (b) bespoke portfolio construction and (c) self-directed assets.

A. Default Lifestyle
These are low-cost multi-asset funds suited to longer-term investments such as pensions plans, which de-risk over time and as they get closer to your selected retirement age.

B. Bespoke Portfolio
This option offers multi-asset diversification to manage risk but also allows a choice of passive and active management, as well as a mix of fund manager strategies by way of a bespoke portfolio design.

Offering huge choices our partnered fund managers include Zurich, Aviva, New Ireland, Irish Life, Friends First, Standard Life, Columbia Threadneedle, BlackRock, Dimensional, BNP Paribas, Legal & General, BNY Mellon, State Street, Goodbody, Merrion, JP Morgan, and Invesco.

C. Self-directed Assets
For clients seeking a more hands-on investment approach, we also offer self-directed investment options which include access to Equities, Commodities, Structured Products, REITS, Investment Trusts, Currencies, and ETFs.


Executive Pension Plan Retirement Benefits

Your Options at Retirement

A company may make whatever contributions are necessary to build up a pension fund which will provide a director with a pension of 2/3rds of their final pensionable salary – subject to a maximum fund value of €2m (for allowable tax-relief).

Come retirement, when you’re ready to take your benefits your options are to take a tax-free lump sum and buy an Annuity which is a paycheque for life, or having taken your lump sum to reinvest the balance in an ARF and make income withdrawals from that.

Tax Free Cash

You can draw a tax-free lump sum based on your salary and service to a maximum of 1.5 times final remuneration where you have more than 20 years of service or you can take a lump sum based on 25% of the value of the pension pot. A limit of €500,000 applies to the tax-free lump sum where the first €200,000 is tax-free and the balance up to €500,000 is taxable at 20%.

Annuity Option

An annuity pays a retirement income for the rest of your life in exchange for the balance of your pension pot at retirement.

ARF Option

An ARF allows you to retain your pension pot at retirement, subject to minimum withdrawals, and can be passed on to your family on death.

Existing Executive Pension Review

Existing Pension Plans – Cost Reduction Audit

If you already have an Executive Pension Plan in place, you need to be sure of 3 things:

  1. That the underlying investments are in line with your attitude to investment risk
  2. That the plan is being funded directly through company monies.
  3. That the underlying charges are reasonable and transparent

Many Executive Pension Plans are been overcharged by inbuilt plan costs, including:

  1. Investment Contribution Charges
  2. Renewal Commissions
  3. Excessive Fund Manager Costs
  4. High Trading fees
  5. Annual Broker Fees

If you’re in any way unsure about your Executive Pension Plan charges, then you should consider talking to One Quote about a cost saving pension review.

If you have any questions with regard to setting up a new plan or leaving an existing employer pension, please visit our FAQ section or call us on: 01 8450049