The Irish Professional Insurance Brokers Association (PIBA) is calling on the government to relax the tax rules surrounding Personal Retirement Savings Accounts (PRSAs), so that payouts below EUR30,000 will be exempt from taxation.
The PIBA believes that Minister of Finance, Brian Cowen should use the opportunity provided by the budget to introduce new legislation that will make PRSAs more attractive and widen pension coverage in general.
According to the brokers group, PRSAs, introduced into Ireland in 2002 to provide employees with a flexible long term retirement savings account, are at a tax disadvantage to SSIAs (Special Savings Investment Accounts), as only 25% of the lump sum available on maturity is tax free.
SSIAs pay income tax only on the gains generated by an investment in the account.
The PIBA believes the popularity of PRSAs would increase dramatically if similar tax treatment were afforded to the retirement savings vehicles, RTE News reported.
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