How To Transfer a Pension From Ireland to the UK

In this guide, we’ll explain which types of Irish pensions can be transferred to the UK and outline how to transfer a pension from Ireland to the UK, providing an overview of the requirements and steps.

What Types of Pension Exist in Ireland, and Can You Transfer Them to the UK?

UK expats working and residing in Ireland can accrue various pensions, including:

1. Occupational pension schemes
2. Personal retirement savings accounts (PRSAs)
3. Buy-out bonds
4. State pensions

Occupational Pension Schemes

Occupational pension schemes – also known as company pension plans – are employer-sponsored retirement savings arrangements established to provide retirement income to employees. In Ireland, these schemes are typically set up under master trust structures, which consolidate administration and reduce costs across multiple employers.

UK expats working in Ireland may participate in two primary types of occupational pension schemes:

Irish occupational pension schemes can be transferred to the UK regardless of their type.

Irish employers are not legally required to provide occupational pension schemes to their employees. While larger firms are more likely to implement occupational pensions in their benefit packages, smaller businesses often opt not to.

Personal Retirement Savings Accounts (PRSAs)

PRSA, or a personal retirement savings account, is a personal pension plan that operates independently of any specific employer.

While both the individual and the employer can make contributions, PRSA is owned by the individual, allowing them to continue contributing to the same plan after changing jobs.

Under Irish law, employers who do not sponsor an occupational pension scheme are required to provide their employees with access to at least one standard PRSA.

PRSAs can be transferred to a UK pension scheme.

Buy-Out Bonds

Buy-out bonds (more commonly known as retirement bonds)) are financial instruments that allow you to transfer accrued pension benefits from an employer’s occupational pension scheme into a standalone policy upon leaving said employer.

Buy-out bonds may be transferred to a UK pension, provided that the receiving scheme is recognised by the HMRC and accepts transfers from Irish schemes.

State Pensions

The state pension is a government-provided retirement income available to individuals who meet specific eligibility criteria. There are two types of state pensions:

1. Contributory state pension
2. Non-contributory state pension

Contributory state pensions are paid out to individuals over the age of 66 who have made sufficient Pay Related Social Insurance (PRSI) contributions during their employment. You are eligible for a contributory state pension if:

• You have between 520 and 2,080 reckonable PRSI contributions, of which a minimum of 520 must be full-rate paid contributions.
• You were employed as a civil or public servant and have made at least 260 full-rate contributions.
• You have worked in another EU/EEA country or a country with which Ireland has a Bilateral Social Security Agreement, allowing for aggregation of insurance periods to meet contribution requirements.

Contributory state pension is not means-tested, meaning eligibility is based solely on an individual’s social insurance contribution record rather than their financial situation. As a result, recipients may continue to receive the pension irrespective of other sources of income.

Conversely, non-contributory state pensions are means-tested payments available to individuals (including UK expats) who do not meet the eligibility criteria for the contributory state pension. To qualify for this pension, an applicant must:

• Be 66 or over
• Qualify as a legal and habitual resident of Ireland
• Pass a means test

Irish state pensions can’t be transferred into a UK pension scheme. However, under the bilateral social security agreement between Ireland and the UK, individuals are subject to social security legislation of only one jurisdiction at a time.

The agreement allows eligible individuals to aggregate insurance periods across both jurisdictions to qualify for benefits in either one, meaning that the Irish contributory state pension benefits can be received while residing in the UK, eliminating the need for any transfer of entitlements.

A non-contributory state pension is not included under the UK-Ireland social security agreement as it is a means-tested benefit rather than a contribution-based one.

Eligibility for non-contributory state pension benefits requires legal residence in Ireland and satisfaction of the habitual residence condition.

Requirements for Transferring Any Pension out of Ireland

The Irish Revenue Commissioners (commonly called Revenue) allows pension transfers out of Ireland under specific conditions and circumstances:

• Transfers must be made prior to benefit commencement: Once you reach retirement age and begin to draw pension income, you are no longer permitted to transfer the pension to a UK scheme.
• Pension benefits must be transferred in full: Transfers must involve the entire pension entitlement without segmentation. Partial transfers or splitting of pension benefits are prohibited.
• The receiving scheme must accurately reflect the transferred benefits: The UK scheme must recognise the full value of the transfer in line with the contributions certified by the Irish pension provider. Any Additional Voluntary Contributions (AVCs) must be clearly identified in the transfer documentation and transferred alongside the main pension benefits as a single transaction. Segregation or partial transfers are not permitted under Irish Revenue rules.
• The Irish scheme administrator must confirm compliance: The pension provider in Ireland needs to confirm that the UK receiving scheme is a recognised and approved pension vehicle. They should also provide a summary of the member’s accrued benefits – such as total contributions and pension fund value – so the UK scheme can correctly set up the transferred benefits. Detailed personal data like salary or lump sum breakdowns is not typically required.
• Transfers must be for a bona fide reason: Transfers are only acceptable if undertaken for genuine reasons and not to circumvent Irish tax or pension law. Potential reasons such as consolidation of multiple pension pots, or the reduction of currency exchange risk or the ability to appoint a UK FCA adviser or indeed a regulated adviser in your country of residency, would be considered. Transfers designed to evade Irish tax on retirement benefits are not permitted.

Requirements for Transferring Occupational Pensions and PRSAs

The Occupational Pension Schemes and Personal Retirement Savings Accounts Regulations from 2003 state that transferring an occupational pension or PRSA is possible if:

1. The transfer is requested by the member or PRSA contributor: Third parties are not permitted to request or authorise the transfer on your behalf.
2. The receiving pension scheme provides relevant benefits: The receiving pension arrangement must offer “relevant benefits” as defined under the Taxes Consolidation Act, section 770. The trustee or PRSA provider must obtain written confirmation from the receiving scheme attesting to this.
3. The receiving scheme has been approved: An appropriate regulatory authority in the UK must confirm the receiving scheme’s credibility. The trustee or PRSA provider must secure written evidence of this regulatory approval.

Transferring Occupational Pensions

Although the UK is no longer an EU member state, the Irish Revenue’s Pensions Manual (Chapter 13) confirms that transfers from Irish occupational pension schemes to UK schemes may continue under similar provisions that apply to EU member states, provided specific conditions are met.

To qualify for a tax-approved transfer:

1. The receiving scheme must be HMRC-approved and exempt under UK pension rules.
2. The transfer must be completed before any retirement benefits are taken. Once benefits commence, transfers are no longer permitted.
3. The full value of the pension must be transferred. Partial transfers or segmentation are not allowed.
4. Irish trustees must obtain written confirmation that the UK scheme will accept the transfer and that the transferred funds will be applied in accordance with Irish Revenue rules.

While EU requirements for Institutions for Occupational Retirement Provision (IORPs) no longer apply to UK schemes post-Brexit, this does not preclude transfers to the UK.

However, because the UK is now considered a non-EU country, Irish Revenue specifies that transfers may only be made to a country in which the member is currently employed.

Given the additional complexity introduced by Brexit and potential regulatory divergence between the UK and EU frameworks, it is strongly recommended to consult with a cross-border pension transfer specialist. Professional advice ensures full compliance with both Irish and UK legislation and minimises the risk of tax exposure or administrative delays.

Transferring PRSAs

Irish Revenue allows PRSA transfers to the UK, provided that the receiving scheme meets all relevant requirements stated above. Notifying Revenue about your PRSA transfer is unnecessary unless some of the mandated conditions are not met.

How Does an Irish Pension Transfer to the UK Work?

Although the steps for transferring a pension from Ireland to the UK may vary depending on pension scheme type and your tax residency status, the process typically requires:

• Seeking professional advice: An experienced pension transfer adviser can determine your eligibility for the transfer based on the specific characteristics of your Irish pension scheme and ensure full compliance with applicable regulatory and tax requirements in both Ireland and the UK.
  Advisers at Titan Wealth International possess extensive experience in cross-border pension planning and can provide structured guidance throughout the transfer process, ensuring regulatory alignment and optimal financial outcomes.

• Signing a letter of authority: Your pension transfer specialist will require you to sign a letter of authority to grant them legal authorisation to contact your pension provider in Ireland and gather information on your current benefits.
• Providing relevant information on your circumstances: To conduct a comprehensive analysis and deliver a personalised, compliant recommendation, your pension transfer adviser will require detailed information regarding your current financial position, tax residency, and long-term retirement objectives.
• Receiving a recommendation: Your pension transfer adviser will assess different pension schemes in the UK and issue a recommendation aligned with your financial objectives and retirement plans.
• Completing the transfer: Your pension transfer specialist can help you obtain the necessary paperwork and finalise the transfer process.

Financial and Tax Implications of Transferring a Pension From Ireland to the UK

The Revenue sees pension transfers as benefit crystallisation events, so you may be liable for tax if your pension’s value exceeds a specific threshold. In addition to the potential tax liability, transferring your pension from Ireland to the UK may incur other charges, including:

Transferring to a non-recognised pension scheme or failing to comply with Irish and UK regulatory requirements may result in substantial financial penalties, potentially diminishing the value of your pension benefits. To mitigate such risks, seeking professional pension transfer advice is highly recommended.