The Finance Bill 2024 has now been passed and as anticipated, new restrictions on PRSA contributions have been introduced. From 1st January 2025, employer contributions to PRSAs will be capped at 100% of the employee’s salary.
The Finance Act 2022 removed the benefit-in-kind (BIK) treatment of employer contributions to employee’s PRSA. Currently, employers are able to pay unlimited contributions to a PRSA for an employee or company director. The contributions are not limited by salary, service, retained benefits, marital status etc. However, this will change in January 2025.
The window is short but there is still time to make contribution. So, if you are planning a material contribution to a PRSA in 2024, the sooner you do it, the better.
Considering these upcoming changes, we expect a high volume of requests for new PRSAs and additional contributions to existing PRSAs before the end of 2024. If you are interested in setting up a new PRSA or making a contribution to an existing PRSA, please reach out to us as soon as possible.
As a business owner, you’re likely accustomed to investing much of your time, energy, and finances into your business. However, it’s essential to think beyond your company’s success and consider your own financial future. Retirement savings often fall by the wayside for entrepreneurs who are laser-focused on business growth. However, its important that you plan carefully, with the right financial tools, to ensure that your golden years are financially secure.