Tax-free lump sum

At Retirement

At retirement everybody has the option of taking a tax-free lump sum. Most people take the maximum amount allowed under this option. The level of tax-free lump sum you can take will depend on the type of pension plan you have and your personal circumstances.

The overall tax-free cash from all your pension arrangements can't be more than €200,000. Any lump sum payment over this limit will be taxed at the standard rate of tax up to a limit of €575,000, as of January 2011.

The maximum pension fund you can have is €5,418,085 (as at August 2009) from all sources. If you have pension funds over this amount, it may affect the tax you pay and you should consult your Financial Advisor.