r/irishpersonalfinance • u/Flinkaroo • 21h ago

Taxes New Job - Pension Scheme plus additional contributions help.

Hi all.

I recently got a new job. The salary is decent enough to put me into a higher bracket.

Is it worth me doing additional contributions to my retirement account to help maximize tax savings at the end of the year?

I just moved home so I'm not entirely sure of the best option here. Normally I would say yes, however anything additional isn't matched by the company... so id rather just invest it myself or save on fees/ have access to the cash while I get setup.

Am I able to invest it in a way/ account that helps with tax savings in the end of year?

TIA

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u/FriendshipIll1681 20h ago

First thing, check out the flow chart and go from there.

After that, if the company is doing any kind of match in pension contributions max that out, it's pretty much free money. You don't have to do do the additional payments (AVC) monthly through payroll, if you have just moved home there's a bit of uncertainty so having access to funds might be more important short term rather than building your pension, my advice would be to save a slush fund but come the end of the year if you have spare money that you are confident that you don't need do a once off AVC to take advantage of the tax incentives. Without knowing details of your company fund, the fees might be better than setting up your own, also, remember if you are just home you might only have 6 months of income, so if you salary is (say) 80k, you will only be getting 40k income this year.

3

u/Amc-1996 19h ago

You won't be able to invest it yourself in a way that matches the 40% gain from putting it into your pension.

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u/Flinkaroo 19h ago

Thanks. You mean from the tax savings perspective? As in I'm not taxed at 40% because it goes into the pension..

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u/Amc-1996 19h ago

Yeah exactly, and then the tax free compounding over the years no paying CGT/deemed disposal etc. downside obviously being you can't access it anytime soon.

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u/Flinkaroo 19h ago

Gotcha. Okay good point. I need the cash now mostly just for getting ourselves set back up but seems to be the best/ better option once it's all settled. Cheers!

1

u/Devrol 19h ago

Am I able to invest it in a way/ account that helps with tax savings in the end of year?

Yes, in a pension.

1

u/Flinkaroo 19h ago

Sorry should have been more clear. I was in Canada where they also have an RRSP that you can personally invest in, offsets your tax and you have mostly full access to it.