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Eire scheme aims to sidestep annuity purchase

An Irish firm is marketing a plan that allows big pension funds to be unlocked where an individual becomes a member of an occupational scheme in the Republic of Ireland.

Dublin firm Business & Financial Planning is charging £35,000 for arranging transfers of UK pension funds to Irish schemes under an agreement between the two countries, which can be unravelled without buying an annuity.

After transfer from the UK, the entire fund can be accessed from the Irish occupational scheme, with 25 per cent paid out as tax-free cash and the balance also taken as cash but subject to UK income tax.

B&FP markets the plan as of benefit for “the self-employed who have personal pension or retirement annuity plans in the UK”. The firm says people wanting to take advantage of the plan do not have to live or work in Ireland but must receive income from an Irish trading company and make contributions into an Irish occupational scheme.

B&FP consultant John Gilmartin says: “The scheme doesn&#39t disadvantage the UK authorities from tax. We deal with advisers in the UK who have clients that can benefit from the Irish arrangement.”

Origen pension specialist Mark Stopard says: “This is no different to those multi-national companies that move their liabilities and assets about to suit themselves – and why not? If there is a legitimate Irish trading company then it is fine. If it is a sham, then the whole arrangement is justifiably at peril from the Irish authorities.”

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