Many company year ends are the 31st Dec. If your company has had a good trading year and potential exposure to corporation tax, there might be a way of mitigating this liability and creating a scenario whereby funds are transferred to yourself personally without tax implications.

We recently gave pension advise to a Company Director, which resulted in the following – a fully funded Company Pension Plan  to the value of €400,000. The Company Director retired and took 25% (€100,000) of the fund value in a tax free lump sum. The balance of the funds was invested into an Approved Minimum Retirement Fund /Approved Retirement Fund providing an income of 4% p.a equating to €12,000.

Both husband and wife were directors, aged 66, and were each entitled to State Contributory Pensions of €12,000 p.a, therefore their aggregate income was €36,000 p.a. This is under the income exemption limit for their age and hence they do not pay tax. That is a neat way of getting €400,000 out of the Company and tax free.

Contact us to find out more …