One of the best pieces of semi-financial advice I ever received was about buying clothes: buy good quality (obviously) and then have the garment altered to fit me specifically; sound financial and sartorial sense. Of course, this means going a little further than one might normally when buying a new outfit, but it’s a little extra that I think is more than justified in the end. Ready-to-wear clothes are great without doubt, but having something that fits you perfectly gives a continued feeling of satisfaction with every wear, it’s so worth it. There are parallels to be made in my professional life as well; it’s such a pleasure to be able to offer clients advice and products that are tailormade to their requirements and fit their circumstances perfectly.
Consolidate your funds
One way in which clients can take this same approach to their pensions is by consolidating all of their funds into one overall pension pot. This enables the disparate funds to be allocated towards the same goal and overall investment strategy can be realigned with where the client finds themselves now. It also serves to simplify things greatly and allows the individual to align with currencies other than those of the initial offerings. This is a service I am delighted to be able to offer now to clients from Ireland, or indeed for anyone who has paid into an Irish pension scheme.
Reduce your tax liability
Transferring Irish pensions to a consolidated scheme also enables Irish expats to take advice from an independent financial adviser in the country where they live. This can be invaluable. Having multiple sources of pension income at retirement can have implications on the amount of tax you pay, and where. If your pensions are based in Ireland and you are resident elsewhere, you could end up being taxed at source in Ireland at a higher rate than you might be in your country of domicile. This will depend largely upon the double tax agreement (DTA) that the two countries may or may not have, and is where consolidating your pensions can be so powerful in reducing your tax liability – although it should be mentioned that individuals must have a bona fide reason for doing so, such as retiring overseas.
Irish Approved Retirement Funds (ARFs) are an option if you are not resident in Ireland, but these can come with some amount of complexity and expense – indeed many Irish providers are unable to offer ARFs to non-Irish residents at all, leaving an individual with the only remaining option which is to buy an annuity. A consolidated scheme will offer you greater flexibility in how you receive your pension payments.
To truly make the best of your pension investments, it’s always worth taking financial advice from a regulated local advisor who really understands the domestic market. By moving your pension to another jurisdiction that is more favourable and has DTA with your country of residence and by having a local advisor, it enables you to begin a professional relationship with an advisor who can guide you through the intricacies of the country’s tax laws, and make sure you are getting the best returns possible. It will open up avenues of investment to you that might have otherwise remained out of reach with your funds locked into an Irish scheme. Further to this, if there are still funds left after death, these can be transferred directly to beneficiaries without incurring Irish Capital Acquisition Tax (unless of course the beneficiaries live in Ireland).
I’m really excited to be able to offer this new service to Irish expats living in Portugal. With a dedicated senior group of Irish nationals at the helm, clients can take great confidence in knowing that their money is being managed by a highly efficient and regulated financial team. This product is developed and tailored to meet the demands of Irish expats worldwide, and to allow the greatest flexibility in managing your money for your retirement. It’s made to measure.