Aviva Pensions

Aviva Executive Pensions

Aviva Executive Pension

An executive pension plan, or company pension scheme, is an investment product designed for employees to save for their retirement. When an employee joins an executive pension plan, they become a ‘member’ of their company pension scheme. An executive pension plan is set up by trustees on behalf of members. It’s tax effective because your employees get tax relief on their contributions, they don’t pay tax on any investment growth within their pension fund, and you, as employer, get tax relief on any contributions the company makes.

  • Minimum single contribution €5,000 (although this can be €25,000 in certain instances)
  • Range of investment funds to choose from
  • Easy switching between funds
  • Online member access to policy details and pension information.

Download our Aviva Executive Pension Customer Booklet for more information.

Who can take out an executive pension?

Any employee or company director whose income is taxed under Schedule E. Members can only use money they’ve earned from an employment that falls within this category. Income outside of members’ employment remuneration can’t be used to buy an executive pension. The likes of rental income, foreign income and untaxed interest are not eligible. Some people have income from two different sources. For example, you may be employed by a company and included in a company pension scheme but also have separate income from self employment such as part time consultancy or farming. You would be allowed to buy a personal pension for this second income even though you are also in an executive pension. Each source of income is dealt with separately for the purpose of personal pension qualifying rules.

How much can a member pay into their executive pension?

There’s no limit to the amount a member can pay into their executive pension plan – and they can increase their contributions at any time – but tax relief is only available on amounts up to a certain level depending on their income, age and Revenue limits. This is set out in the table below (March 2019):

Age attained during the year Tax relief limit
(based on a percentage of earnings)
Under age 30 15%
30 to 39 20%
40 to 49 25%
50 to 54 30%
55 to 59 35%
Aged 60 and above 40%

There’s a limit on how much of a member’s earnings can be taken into account for the purposes of the above percentages. The maximum earnings limit is currently set at €115,000 (in 2019). So, if a member’s earnings are greater than this figure their tax relief will only be based on their earnings up to €115,000 – anything above that limit doesn’t qualify for tax relief.

How does the tax relief on an executive pension work?

Tax relief reduces the real cost of a pension. Your members don’t have to pay tax on any money that they put into an executive pension – once it falls within the limits outlined earlier. The tax they save is calculated at the highest rate of income tax that they pay (20% or 40%). An example of how this works is set out below:

Monthly pension contribution = €100
Tax relief @ 40% = €40
Total net monthly cost to you = €60

If you pay income tax at the 20% rate, your tax relief will be €20 and your total net monthly cost will be €80.

How does a member claim the tax relief?

When you’re a member of an executive pension plan, usually your employer will take the contributions directly from your salary – in which case the tax relief is instant. As an employer, you get tax relief on any contributions the company makes towards a pension plan for employees (once the contributions are within the agreed limits).

What happens if a member leaves employment?

If a member changes jobs, they can take their pension plan with them, so they aren’t tied down to working for just one employer throughout their career. On the other hand, new joiners to your company pension scheme will be able to transfer-in their accumulated pension funds from previous employers. If a member leaves employment within two years of joining your company, they’re able to apply for a refund of any additional voluntary contributions they made during the period of employment.

Can members take their money out if they need it in the future?

No, once a member has put money into an executive pension, they can’t withdraw it until they reach age 60 unless they retire early.

What happens if a member has to retire early because of ill health?

If a member has to retire early because of ill health, they can take their benefits from their executive pension immediately.

What happens if a member dies before they retire?

If a member dies before they retire, we’ll pay a value of their Aviva Executive Pension to their estate in the form of a lump sum (and annuity).

Can a member use their pension as security for a loan?

No. They can’t transfer the rights to their pension plan to a bank or another institution as security for a loan.

What is the minimum term for setting up an Aviva Executive Pension?

The minimum investment period for paying regular contributions to the Aviva Executive Pension is 2 years. There is no minimum investment period for single contributions.

How are contributions paid?

You and/or the member pay regular or single contributions to the Aviva Executive Pension through the member’s salary. That way both the employee and employer will get tax relief on contributions at source. The Aviva Executive Pension can also accept transfers from other executive pensions – these would usually be paid as electronic fund transfers from other institutions, or may come via you as trustee. You and/or the member can pay a single contribution at anytime into the Aviva Executive Pension. You can do this instead of, or as well as, paying regular contributions.



Expert advice

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Important information to consider.

Warning: Past performance is not a reliable guide to future performance.

Warning: The value of your investment may go down as well as up.

Warning: If you invest in this product you will not have any access to your money until you retire

Warning: If you invest in this product you may lose some or all of the money you invest.

Warning: This product may be affected by changes in currency exchange rates.

Aviva Life & Pensions Ireland Designated Activity Company, a private company limited by shares. Registered in Ireland No. 165970. Registered office at One Park Place, Hatch Street, Dublin 2, D02 E651. Aviva Life & Pensions Ireland Designated Activity Company, trading as Aviva Life & Pensions Ireland and Friends First, is regulated by the Central Bank of Ireland. Tel (01) 898 7950.