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Mr & Mrs Murphy, 64 & 59, Ireland.

Posted in on Mar 23, 2020

Investment Concerns:

Tax on pensions at drawdown

Motivation to move to a Wealth Management firm:

Independant advice revolving around Financial advice of Pensions.

Mr & Mrs Murphy have ran their Pharmacy for over 25 years. Mr Murphy is the Superintendent Pharmacist. Both are Directors and active in the business for more than 5 years. Both have a 50% equal shareholding for the last 25 years. The business bank balance is over €2 million

When Walfrid Private met Mr & Mrs Murphy their plan was to top up their Pensions on the advice of an existing Pension Broker and Bank. They already had funds in excess of €1 million each.

Walfrid Private offered a solution:

Walfrid Private urged Mr & Mrs Murphy to sit back, relax and take a look at what they want to achieve going forward. We advised them to consider Extraction Strategies that could be built around Succession Planning and Legacy Control, i.e. what will happen the business when they retire. We informed the couple of Retirement Relief, a Capital Gains exemption for Company Directors that meet the qualifying criteria.

Result:

No Pension contributions were made as Mr & Mrs Murphy would have been liable to Tax on drawdown due to the existing fund values. Instead the Clients engaged in Financial Planning strategies that utilised many functions of the Financial Services Spectrum. The result was that each Director was able to extract €750,000 Tax Free from the Business while bringing their children into Director level positions with a shareholding.