The AMRF is no more! How will this impact me?

The Finance Bill 2021 introduces changes to Pension rules


The Finance Bill 2021 was signed into law in December 2021. It introduced a number of significant changes to pension rules, including the removal of the AMRF (Approved Minimum Retirement Fund). These changes were based on some of the recommendations detailed in the report produced by the Inter-Departmental Pensions Reform & Taxation Group (IDPRTG).


There are both positive and negative potential implications to come from these changes for clients who are retiring or who have already retired, as will be discussed below…

In general, however, we welcome these changes as the associated restrictions on AMRFs were regarded by many as no longer fit for purpose.


What was an AMRF?


Previously, before an individual could take out an ARF (Approved Retirement Fund), up to €63,500 of their fund would have been needed to purchase an Approved Minimum Retirement Fund or AMRF. At age 75 the AMRF would then be converted into an ARF. If the person had a guaranteed income of over €12,700 per annum including the state pension then an AMRF was not required. 


The purpose of the AMRF was to help pensioners secure their income throughout retirement by protecting them from drawing too much income from their pension funds, if they had a guaranteed pension income less than €12,700 a year.


What has changed?


1. The AMRF requirement will no longer apply at retirement  if you are looking to avail of the Approved Retirement Fund (ARF) option from Occupational Pension Schemes, Personal Pensions (Retirement Annuity Contracts), Personal Retirement Savings Accounts (PRSA’s), and Personal Retirement Bonds.


2. Legislative rules and conditions applying to AMRFs were repealed with effect from 1 January 2022 – and Fund Managers cannot accept any assets into an AMRF after 1 January 2022.


The AMRF requirement will longer apply at Retirement if you are looking to avail of the Appr

At retirement, you will no longer need to meet the following requirements:


  1. Have a guaranteed pension income of €12,700 a year.
  2. Invest €63,500 into an AMRF.
  3. Keep €63,500 as a restricted fund in a vested PRSA.
  4. Use €63,500 to purchase an annuity (pension income for life


Additional changes made, as follows:


  1. The death in service options available from company pension plans have been expanded to allow for the deceased’s spouse to invest in an ARF as an alternative to a spouse’s annuity.
  2. The restriction which prevented those in company pensions with their employer for more than 15 years from transferring to a PRSA has been removed. Other requirements still apply when transferring to a PRSA.


I have an AMRF, how will this impact me?


The changes will impact many clients who held AMRF policies – for example those who, until now, did not satisfy the guaranteed income requirement (€12,700) and/or those who due to their age (under 66) meant that they were not yet in receipt of state pensions.


It will also impact, in some cases, those who had reached state pension age but did not receive the maximum rate of state pension and meet the threshold of €12,700 – for example, due to gaps in their Pay Related Social Insurance (PRSI) record.


On 1 January 2022 your existing AMRF plan automatically became an ARF, and the legislative rules applying to ARFs now apply to these former AMRFs.


I have a vested PRSA restricted fund, how will this impact me?


What is a vested PRSA?

It is a PRSA where the Retirement Lump Sum has been paid out and the residual fund remains in the PRSA rather than transferred to an AMRF. 


The above changes to AMRFs also apply to vested PRSAs:

The restricted fund requirement is now removed from your vested PRSA.  This change will give you greater flexibility regarding your withdrawal options.


Options at Retirement


The requirement to purchase an AMRF for those without a guaranteed income of €12,700 has now been removed.

As a result, should you choose the “ARF Option” for your residual fund, you can now allocate the entire residual fund (after the Retirement Lump Sum is paid) to your ARF – or to a number of separate ARF policies – or to a combination of ARF and/or Annuity.

You may also take the residual fund as a once-off taxable cash payment.


Withdrawals from ARFs:

Withdrawals from ARFs


Prior to 1 January 2022, the maximum withdrawal that was allowed from an AMRF was 4% per annum. Given the recent changes, if you previously held an AMRF policy, you may be tempted to take large withdrawals or fully encash the policy.


This may be essential in cases of illness or financial hardship, but be advised that significant withdrawals or full encashments may result in early surrender penalties and will likely be taxed at your marginal rate of income tax, USC, and PRSI (where applicable).


When a full encashment is made in any given year, this could result in a higher tax on those funds when compared with taxation where the funds are withdrawn on a gradual or phased basis over a number of years.




  1. The removal of AMRFs now allow for simplified post retirement options.
  2. This will give more flexibility in accessing your pension fund, and your withdrawal options.


A Caution:


  1. The requirement to draw an annual income from your entire pension may may have implications on the expected longevity of the fund in retirement. Here, consideration should be given for the investment decisions made in relation to your income requirements.


Impartial Financial Advice


Contact us for Financial Advice

You may have additional options and possibilities as a result of the changeover from AMRF to ARF.


For advice in understanding your available options, speak to our Financial Advisors who will be able to guide you appropriately.


Need some assistance?

Fill out your details and enquiry below, and one of our Qualified Financial Advisors will get back to you shortly.

What happens to my pension plan when I leave a company?


We frequently come across this question: “What happens to my pension plan when I leave a company?” Nowadays people are changing jobs or even careers more frequently than they used to, and it has also become a common occurrence to leave Pension savings behind with past employers. When moving from one job to another there are many important things to consider – your Pension is certainly one of them.


Leaving your Pension behind may be the easier route to go but it may negatively impact your Retirement Planning if it is not incorporated with your overall long-term plan.


This can also be a good opportunity to sit down with your Financial Advisor and review how you are meeting your Retirement objectives or how you can improve on them.


Leaving Service Options:


It’s important to note that your pension benefits are managed and legally owned by the trustees of the scheme (these include but are not limited to companies like Aon, Mercer, and Willis Towers Watson), and when departing from your company your legal status will change from an ‘Active’ to a ‘Deferred’ member of the scheme. We will later assess the downsides of staying on as a ‘Deferred’ member.


When leaving your employer you should receive what is known as a ‘Leaving Service Options letter’, or your ‘Pension Benefits Options Statement’. This document will include important information such as the date you joined the scheme, the date you left, the value of your Pension, and finally setting out your choices available to your particular situation upon leaving. It is therefore vital that you receive this document.


Essentially, you have three main options when leaving your employer.


  1. Leave your Pension where it is (do nothing).
  2. Transfer your Pension to your new employer.
  3. Move your Pension into an account in your own name (Personal Retirement Bond / Buy-out Bond).


Option 1: Leave your Pension where it is (do nothing)


Although the easiest option, leaving your Pension behind is the least recommended particularly because Pension schemes are under no obligation to keep any engagement with you nor provide you with annual updates on how your pension is being managed or invested. Therefore, you are left in the dark without freedom to make investment decisions.

In many cases, employees Pension savings are actually moved out of investments and into cash leaving them unable to outperform inflation and the associated charges within the fund. As a result, this hinders the growth of your Pension and may set back your Retirement goals and objectives.


If you are considering leaving your currently employer, and are looking to review your ; we would implore you to answer the following questions:


  • Are the charges fair and transparent?
  • Is the Pension Provider responsive?
  • Has your Pension performed well?


If your answers to the above questions did not bode well with you then it would be wise to consider taking your Pension with you.



  1. As a deferred member, you will still be able access your pension at retirement date; ie, take a tax-free lump sum; and transfer the funds into an annuity, or opt for an Approved Retirement Fund (ARF).



  1. The Trustees of the scheme are not obligated to keep in contact with you (no regular updates).
  2. Your Retirement options are subject to the scheme rules (including early Retirement).
  3. Bigger schemes have limited Investment options since they cater for large groups of employees (your investment could under-perform).
  4. No access to Financial Advice after you have left the company.
  5. When moving jobs, you run the risk of forgetting about the plan and losing contact with it over time.
  6. Passing away before retirement could complicate matters for your dependents.


Option 2: Transfer your Pension to your new employer


You can consider moving your existing benefits over to your new company’s pension scheme thereby consolidating your retirement benefits, however, not all schemes allow this and you would have to check first.


The advantage here is that you will have everything under one roof and it will be easier to work out your overall pension benefits and how much income you would expect in retirement, rather considering a number of different pots.


On the downside, transferring your pension benefits would require you to sell up existing assets in order to transfer them to the new fund. This would introduce the risk of being out of the market for a considerable period, and depending on market conditions, this could mean you selling out at a lower price and buying at higher one.



  1. Pension consolidation – maintaining control over your pension pot and keeping it together in one place.



  1. You may lose accumulated rights of salary and service if you move move into the wrong type of scheme being offered.
  2. If you move jobs again, you will have to address all previous concerns and requirements of moving into new scheme.
  3. You miss the opportunity to move the fund into your own name (taking complete control over your money and Investment choice).


Option 3: Move your Pension into an account in your own name (Personal Retirement Bond / Buy-out Bond)


A Personal Retirement Bond (PRB) is a product that is specifically designed to take benefits from your previous employment. This includes giving you greater control to administer your own pension savings, and a better investment strategy allowing you to invest at your own attitude to risk (with added benefit of guidance from a Financial Advisor). You also have the option to move the bond from one pension provider to another if you feel you could get better value on charges, fund allocation rate, and access to funds, etc.. However, it cannot be further contributed to.


This route allows you to completely cut ties from your old employer, which means no more involvement of Trustees. The charging structure (Annual Management Charge) can be a higher with PRB’s depending on the funds (or asset classes) chosen but this is considered along with the performance (and active management) of the fund over time. In saying that, you will have the benefit of transparency of charges (which are more competitive than company pensions).



  1. Full control over your pension and Investment decisions (fund is owned by you personally).
  2. A Financial Advisor can put together a tailored investment strategy (based on your attitude to rick) to help you reach your retirement goals and objectives.
  3. Your accumulated rights are preserved (salary and service details recorded) giving you access to your tax-free lump sum entitlement, and increasing your options to draw on retirement.
  4. Move your PRB from one provider to another efficiently.
  5. Your benefits can be taken from age 50 (as with the company scheme).



  1. Annual Management Charges can be higher depending on the funds/assets classes chosen.


What happens to my pension plan when I leave a company?


What do we recommend?


In most cases, the Personal Retirement Bond is the most practical route, it is a simple, straightforward way to take your pension entitlement with you when you change jobs. The Pension savings that you have built up are yours, so why not take personal control of the assets you own.


With the ongoing support of impartial Financial Advisors, we will first establish if this is the right option for you, and if so, we can help guide you through the Pension transfer process and ensure that the funds are set up correctly, managed effectively, and monitored continuously!


What happens at Retirement Date?


On retirement you can take a tax-free Lump Sum of either:

  1. 25% of your fund, or;
  2. A maximum of 150% of salary, based on salary and service.

The maximum tax-free Lump Sum you can take is €200,000.


The remainder of your fund can then be used to purchase:

  1. A guaranteed income for life (Annuity), or;
  2. Transfer the balance (after the Retirement Lump Sum is taken) into an Approved Minimum Retirement Fund (AMRF) or Approved Retirement Fund (ARF).


How do I begin the transfer process from my old employer?


If you are currently planning on leaving your Employer or looking to take old Pension benefits that were previously  left behind, the first step is to contact the HR Department at the company and request your ‘Leaving Service Options.


The HR department or pension administrator will make a request to the trustees on your behalf to issue you with your ‘Leaving Service Options Letter‘ outlining the current value of your benefits and your available options.


What happens to my pension plan when I leave a company?

After you have received this document you may feel free to give us a call on 01 253 3242.


     Drop us a call here     


Alternatively, if you would like to speak to one of our Qualified Financial Advisors first to discuss your situation, leave your response and details below and we will get back to you shortly.


Need some assistance?

Fill out your details and enquiry below, and one of our Qualified Financial Advisors will get back to you shortly.

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