In this month’s issue we discuss tax-saving opportunities for Employees and Self Employed.
Tax-saving opportunities for Employees
If you are an employee who feels you are paying too much tax, the good news is that you may be entitled to a refund of some of the Income Tax you paid in 2022.
This can be achieved by personally making a lump sum Personal Pension, PRSA or PRSA AVC contribution, depending on your employment circumstances, by 31st of October 2023 (or 15th of November 2023 for ROS users) and electing to backdate the tax relief to 2022.
Note: If you use the Revenue Online Service (ROS) to both file your tax returns and pay your taxes you have until 15th of November 2023 to file and pay for 2022.
Important! Tax refunds are claimed by the individual informing his/her tax district by 31st of October 2023 that the tax relief on the contribution paid by this date is to be backdated to 2022.
What type of pension plan?
• If you are an employee that is a member of your employers occupational pension scheme, you can make additional voluntary contributions (AVC’s) to your occupational pension scheme (subject to scheme rules allowing same), to a Group Additional Voluntary Contribution (AVC) arrangement or to a PRSA AVC plan.
• If you are an employee that is included in a PRSA to which your employer is contributing, you can make employee contributions to that PRSA plan or another PRSA plan of your choice.
• If you are an employee that is not included in an occupational pension scheme or PRSA to which your employer is contributing, you can make contributions to a Personal Pension plan or a PRSA plan.
Make the most of the tax-efficiency of pension contributions now – you may never get such good value again.
Tax-saving opportunities for the Self-employed
Every year thousands of self-employed people across Ireland use their pension as a great way of reducing their tax liability. It’s easy, efficient, and if you aren’t doing it, you should ask yourself why not.
If you are self-employed you must calculate your tax liability and make a payment by 31st of October 2023 (or 15th of November 2023 for ROS users)
in respect of your:
1. Final Tax Assessment for 2022;
2. Preliminary Tax for 2023.
You can reduce your 2022 Final Tax liability and your 2023 Preliminary Tax liability by making contributions to a Personal Pension plan or PRSA and electing to backdate the tax relief to 2022.
Age related limits apply to both Employees and Self Employed
Your pension contributions are subject to age-related limits
1.An earnings cap of €115,000 applies to contributions.
Pension contributions made by you in 2022 must be deducted from the maximum tax-allowable contribution calculated based on these limits.
2. Age is age on your birthday in 2022.
3.Retirement benefits are subject to separate Revenue limits.
4.Reference throughout this document to ‘Tax’ refers to ‘Income Tax’.
Should you wish to discuss tax saving opportunities please do not hesitate to contact a member of our advisory team at Jim@hegarty.ie, Niamh@hegarty.ie, Frank@hegarty.ie & Ross@hegarty.ie or alternatively you can call the office directly on 01 4972544
In other news
St Finbarr’s national hurling and football club golf classic 2023
Dripsey G.A.A golf classic 2023
We are happy to continue supporting St Finbarr’s national hurling and football club golf classic 2023 and Dripsey Gaa Golf Classic 2023
Hegarty Financial Management 40 years caring for our clients financial wellbeing.
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