Click here to view.
The PRSI contribution, normally payable by employer and employee, is a percentage of the employee's reckonable earnings (i.e. gross pay less superannuation and Permanent Health Insurance contributions, deducted under a net pay arrangement by the employer, which are allowable for income tax purposes).
An AVC is a voluntary contribution made by employees in addition to the required contributions if any, that are to be made to their company pension schemes. Generally, an AVC is made to take advantage of the tax benefit and to also improve the benefits available at the time of retirement. AVC's are subject to Revenue limits.
The 2011 Budget on Dec 7th announced that the Health Levy and Income Levy are both to be abolished and replaced by a new Universal Social Charge from Jan 1st 2011 . The new USC deductions will be applied to all income paid from Jan 1st 2011 This USC is a tax and does not provide a benefit to those paying the charge.
Who can benefit?
Payment of a supplementary pension can arise where the person has retired from a Public Service position and was paying full PRSI i.e. be a Class A PRSI contributor and is only eligible for what is known as a co-ordinated pension, retires before reaching 65 years of age and who has no entitlement to any social welfare benefit or qualifies for a reduced level of benefit only.