AVC and Pension Tax Relief in Ireland: How Much Can You Actually Save?
Pension tax relief is one of the most generous reliefs available in Ireland — and one of the most under-claimed by expats. Every euro you put in comes out of your pre-tax salary, which for a 40% taxpayer is an instant 40% return.
How the relief works
You get income tax relief at your marginal rate — 20% or 40% — on personal pension and AVC contributions. USC and PRSI still apply, but the income tax piece is the big win.
Age-band limits
The percentage of salary you can contribute (and claim relief on) rises with age: 15% under 30, 20% in your 30s, 25% in your 40s, 30% at 50–54, 35% at 55–59, and 40% at 60+. Capped at €115,000 of earnings.
Worked example
45-year-old on €70,000, contributes €7,000 as an AVC. Relief at 40% = €2,800 back. Net cost of a €7,000 pension top-up: €4,200.
The October window
You can make an AVC for last year up to 31 October (or the ROS extended date in November) and claim the relief against that prior year's tax. This is one of the few times you can retroactively reduce a tax bill.