Pension Mortgage

Property has become a very popular choice for Irish investors. Buy-to-let schemes dominate the financial press and literature from financial institutions. Although there are risks with this option, especially given the extraordinary growth levels achieved over recent years, property investment still holds strong long-term prospects. Proprietary Directors and the Self Employed have at their disposal the option to buy an investment property and pay back the capital with the 25% tax free lump sum that emanates from their pension fund at retirement age (or indeed by cashing in the entire pension fund).

A pension mortgage works on the basis that you only pay back interest on your mortgage loan every year. At the same time you take out a pension plan into which you make regular contributions. At the end of the mortgage term you will use your retirement funds to pay off your loan.

When you use a pension mortgage plan to repay your loan, you will also benefit from substantial tax relief on the repayment of the interest on the loan. You can offset the interest on the loan against the rental income from the property. You will be liable to income tax on the surplus of the rental income over to interest.

The Advantages of a Pension Mortgage

• Tax Relief on contributions
• Tax free growth on the fund
• Tax free lump sum.

For information, advice or a quotation please use the contact us form here or email info@ppsdelaney.ie.