ARF Imputed Distribution rate reduced
We welcome the reduction in the Imputed Distribution rate for ARFs and Vested-PRSA-ARFs (up to €2m) from 5% down to 4% between the ages of 60 and 70. The purpose of the change is to reduce the risk that ARF owners will outlive their retirement funds (by reducing the possibility of the fund running out). However, it is a pity that the age limit of 70 applies, and the Imputed Distribution Rate reverts back to 5% thereafter.
Withdrawals from AMRF now permitted but…
For the first time, new provisions will allow a maximum annual withdrawal of 4% (subject to taxation) from an AMRF (but not, it appears, from Vested-PRSAAMRFs). However, after 1 January 2015, it will NO LONGER be possible to withdraw income or gains made by an AMRF in excess of 4%, so AMRF-holders wishing to access fund growth from their AMRF in the near future should consider withdrawing these gains before 31 December 2014. Otherwise future withdrawals from the AMRF will be limited to 4% (under the current proposals).