A

AMRF

Approved Minimum Retirement Fund ('AMRF'). Certain individuals availing of the ARF retirement option may be required to invest in an AMRF where they do not meet the income test.  In the event that you do not have sufficient guaranteed annual income (€18,000 as at January 2011), you are required to set aside a variable amount equivalent to 10 times the maximum rate of State Pension (Contributory) payable annually (€119,800 as at January 2011) of your remaining pension fund after any lump sum has been taken (or the entire fund if it is less), until you reach 75 years of age at which stage the AMRF will convert to an ARF.

While you cannot make any withdrawals from the original capital invested in an AMRF, you are entitled to withdraw any investment income or gains in excess of the original capital invested as a taxable withdrawal.

You should note that when you reach the age of 75, or upon death, the AMRF automatically converts into an ARF.

Annuity

An annuity is a single premium policy purchased with a life company under which the life company, in return for a lump sum now, guarantees to pay a specified level of income for the lifetime of the individual and potentially their dependents (on the death of the policy owner). 

ARF

An Approved Retirement Fund ('ARF') is a tax-exempt investment fund into which you can (if eligible) transfer the balance of your pension fund after you receive your lump sum and after you have satisfied the income test and / or the AMRF conditions, (as outlined above). You may make withdrawals from your ARF (which shall be taxable). The key purpose of an ARF is to provide benefits over the duration of your life from retirement and they should be viewed as long term investments.

AVC

An Additional Voluntary Contributions ('AVC') is a means by which members of an occupational pension scheme can increase or top up their existing employer’s occupational pension scheme benefits, within Revenue limits, at their own expense.

AVC PRSA

A PRSA set up to enable you make Additional Voluntary Contributions (AVCs), (as outlined above).

I

Imputed Distributions

For ARF investors over the age of 60, an annual imputed distribution is an assumed or notional withdrawal from an ARF each year for tax purposes.  The imputed distribution amount is reduced by the amount of any withdrawals made by the ARF investor during the year. No imputed distributions will be made from an ARF in respect of a year where the ARF investor has taken total withdrawals from the ARF of an amount at least equal to the rate of imputed distributions to apply to that year.

N

Non-Standard PRSA

A non standard PRSA is a specific type of PRSA contract where there is no legislative limit on charges which can be applied and where you can invest in a range of funds, including (but not restricted to) pooled funds.

O

Occupational Pension Scheme

An Occupational Pension Scheme is a scheme set up by an employer in the State to provide retirement and/or other relevant benefits to its employees (those in receipt of Schedule E remuneration for income tax purposes), which has been approved by the Revenue Commissioners.

P

Personal Pension

A Personal Pension is a pension plan available to individuals who are self employed or in non pensionable employment, which is issued by a life company. It is also known as a Retirement Annuity Contract (RAC).

PRSA

A Personal Retirement Savings Account ('PRSA') is a personally held, tax-efficient defined contribution investment account designed to enable you save for retirement in a flexible manner.

Q

QFM

A Qualifying Fund Manager ('QFM') is the entity charged by Revenue for ensuring that an ARF is managed in line with prevailing guidelines and legislation and for accounting for any tax that may be due on distributions from the ARF.

R

RAC

A Retirement Annuity Contract (RAC) is a form of a personal pension plan available to individuals who are self employed or in non pensionable employment.

Retained Benefits

Pension benefits built up in schemes associated with previous employments or periods of self-employment.

Retirement Bond

A Retirement Bond is a single premium, tax efficient defined contribution investment account effected by the trustees of an occupational pension scheme on behalf of a scheme member that is leaving service or when the scheme is winding up, in lieu of providing a preserved benefit under the scheme for that member. A retirement bond is available from a life company.

S

Self Administered Scheme

A Self-Administered Scheme is a tax efficient occupational pension which is set up under trust for the benefit of a single member.

Standard PRSA

A Standard PRSA is a specific type of PRSA which will have maximum permitted charges of 5% on each contribution and 1% per annum on the fund value.  An investor is restricted to investments in pooled funds only, except for temporary cash holdings.