Michael McGrath
Question:89. Deputy Michael McGrath asked the Minister for Finance his plans to change the maximum pension fund limit of €2 million; and if he will make a statement on the matter. [43771/19]
View answerWednesday, 23 October 2019
Questions (89)
Written answers
The Standard Fund Threshold (SFT) is the maximum allowable pension fund on retirement for tax purposes which was introduced in Budget and Finance Act 2006 to prevent over-funding of pensions through tax-relieved arrangements. The threshold was initially set at €5 million, which was subsequently reduced to €2.3 million in 2010 and further reduced in Budget 2014 and Finance (No 2) Act 2013 to €2 million with effect from 1 January 2014.
I believe that the €2 million threshold represents an appropriate level at which an individual can provide themselves with an adequate income into their retirement. This threshold strikes a balance between incentivising individuals to save for retirement to a reasonable limit, and deterring individuals from targeting tax-relief to over-fund pension funds.