The Gazette 1991

GAZETTE DECEMBER 1991 The Law Society Retirement Annuity Pension Plan

Now is the Time to Get in We are again approaching that time in the financial year when those who are self employed are looking for some tax breaks to alleviate the tax liability before the end of the income tax year. With all of the recent government talk of increas- ing the tax net and withdrawing or reducing allowances and reliefs, still one of the most attractive tax breaks available is the area of pension contributions. All contri- butions are fully deductible against income tax at your top rate subject to an overall limit of 15% of net relevant earnings. While this article does not allow the space to go into the detailed tax complications of pension contributions, I would like to bring to your attention one of the most attractive and beneficial plans available at present, namely the Law Society Retirement Annuity Plan. This plan offers all the tax benefits mentioned above and much more. Retirement Annuity Plan The Incorporated Law Society established a Retirement Annuity Plan in 1975 to provide its members who are self employed or in non pensionable employment wi th the opportunity to provide for their retirement during their working life. There is still a very small per- centage of qualified solicitors who are actually members of this scheme but the number are increasing annually. The significant advantages of this scheme over all other available schemes have to be highlighted. Main Advantages The main advantages of the scheme will be felt in the early years as a direct result of the very low entry costs. The entry and ongoing cost of the Retirement Annuity Plan are lower than those of any other life assurance scheme available at present. The initial entry charge is only 2.5% of each sum invested and the ongoing

Performance Although I cannot guarantee the rate of return of the plan, our objective as fund manager is to achieve a real rate of return substantially in excess of inflation. The returns for the past six years and the year to date are set out in the Table. As you will see from these figures, the Law Soc i e ty Plan has pe r f o rmed very f avou r ab ly alongside the main insurance companies and remember all gains made w i t h in t he f und are completely tax free. Time to Invest This is normally the time when you will be considering making pay- ments or increasing contributions to an existing plan. Contributions for tax purposes can be made up to the 31st January, 1992 and if you are cons i de r i ng mak i ng payments, why not consider the Law Society Plan for your next contribution. If you require any further details on the plan and wish to investigate the many benefits in great detail, please contact either myself or Terence Deacon at The Investment Bank of Ireland Limited, 26 F i t zw i l l i am Place, Dublin 2. Telephone 616433. •

by Harry Cassidy, Associate Director, Investment Department, The Investment Bank of Ireland Limited. management fee is only 0.5% per annum. Normally, most insurance schemes carry an entry charge of at least 5% with annual management fees ranging from 0.75 to 1%. This has a negative effect on the investment level and performance. The Law Society Retirement Plan has the following benefits: • Low entry costs. • Low management fee. • No initial units. • No charge for sw i t c h i ng between funds. • No penalty charges for ceasing contributions. In making contributions to the plan, you are not tied to making payment every year. Indeed, the minimum contribution that can be made in any year is only £500. Choice of Funds The Plan is invested in two funds. A solicitor can choose to invest in the managed fund which is a broad spread of equities, gilts and cash or the cash fund which is suitable for those years immediately prior to r e t i r ement t hus a l l ow i ng an individual to protect accumulated gains.

Year to 1/10/91

87

9 0

89

85

88

8 6

Irish Law Society Pension Fund Irish Life Managed Fund

(9.4) 19 .2 26 .9 7 . 4 2 0 . 8 28 .1

17 . 98

14 . 22

(11.2) 19 .8 26 .1 10 .9 22 . 1 2 4 . 9

Standard Life Manged Fund

17 . 42

(14.8) 16 .4 2 9 . 0 14.1 2 0 . 8 3 1 . 2

4 13