Employers which themselves contribute to their employees’ pension pots will also benefit from tax incentives, namely:
- Tax Credits: employers will receive a tax credit equivalent to 25% of their contributions, up to a maximum of €750 per employee per year. Any unused tax credits may be carried forward to future years, indefinitely.
- Tax Deductibility: Employer contributions are treated as a tax-deductible expense on your Profit & Loss statement, up to €2,000 per employee per year.
Effectively, the tax benefits need to be taken into account when assessing the net financial outlay for employers.
Laferla does not offer tax advice, and clients are encouraged to seek advice from tax experts if they would like to know how taxation will apply in their specific circumstances.