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APT appointed as registered administrator for Irish Permanent windup

APT secures the appointment to wind up the defined benefit scheme following a tender process undertaken by the Trustees.

Following a tender process undertaken by the Trustees of the Irish Permanent Staff Pension Scheme, Allied Pension Trustees Limited (APT) have been appointed to undertake the winding up of the scheme.


Change in priority order for DB schemes in wind up

Joan Burton announced a series of changes which include a change to the priority order for defined benefit schemes on wind up, together will a less tolerant approach for schemes which fail to meet a minimum level of solvency.

Apart from the cases of double insolvency, the change in priority order will have limited impact on the majority of schemes.

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ARFs and Defined Contribution Pension Plans

Prior to The Finance Act 2011, defined contribution members were compelled to buy an annuity at retirement with the proceeds of their retirement accounts. The Act removed this compulsory annuity purchase by extending the option for all proceeds arising from a defined contribution pension plan to transfer at retirement to an Approved Retirement Fund (ARF) / Approved Minimum Retirement Fund (AMRF)

Prior to 2011, only the proceeds from Additional Voluntary Contributions (AVCs) could transfer to an ARF. The balance of retirement funds were compelled to buy an annuity

What is an ARF / AMRF

Simply put, an ARF

  • Is an investment product to which you transfer your retirement fund at retirement
  • It remains invested over your lifetime, unless you decided to encash it early
  • You must draw an annual income of 5% (or 6% – amounts over €2m) which is subject to tax
  • Provides an alternative to annuity purchase
  • Allows you to retain control over the investment of your retirement assets
  • Allows your pension assets pass to your estate on death

How does it differ from an annuity?

There are two key differences, namely

  • When you buy an annuity you loose ownership of your capital in exchange for the payment of a guaranteed monthly income for life. The annuity provider (Insurance Company) retains your capital
  • When you transfer to an ARF, you retain ownership of your capital, (which passes to your family or estate on death) but depend on the investment return on your capital to maintain the value of your capital amount

What is a suitable investment strategy?

Our team of investment consultants will devise a strategy to suit your particular needs. However you must remember a couple of important points namely,

  • Life expectancy has improved greatly in recent times, which means your ARF may be invested for a very long time
  • As with any long term investment, your ARF will need to hold a significant amount of “performance seeking assets” (stock market investments etc), the performance of which may be volatile
  • However, over this period of time, you are unlikely to dispose of your ARF on a single given day – you are more likely to take monthly drawdown of income. Therefore the market volatility will not have a negative effect on you capital over the long term

The Rules?

Transfers to an ARF may occur from defined contribution plans, personal pension policies and Personal Retirement Savings Accounts (PRSAs)

The remainder of your fund may be invested in the ARF. If you do not have a guaranteed pension income from another source of more than €12,700 pa, you must:

  • Invest the first €63,500 of your capital in an Approved Minimum Retirement Fund AMRF) which you cannot access until age 75,or
  • Use the first €63,500 to buy an annuity.


Client Assets Key Information Document (CAKID)