Róisín Shortall (Dublin North West, Labour)
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Question 118: To ask the Minister for Finance if he will incorporate into the proposals for the national pensions framework a commitment to the reduction in the value of maximum possible tax free pension pots. [27999/10]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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The maximum allowable pension fund that an individual can build up from tax-relieved contributions is known as the Standard Fund Threshold or SFT. The SFT is a lifetime limit which was introduced in Budget and Finance Act 2006 at an initial level of €5 million and was increased in line with an indexation factor in 2007 and 2008 to its current value of just over €5.4 million. In line with the decision made in Budget 2009, there was no indexation of the SFT for 2009. Penal tax charges apply to any funds in excess of the threshold.

The National Pensions Framework does not include specific proposals in relation to the SFT. I am aware, however, of the recommendations in the Report of the Commission on Taxation which, among other things, proposes a reduction in the level of the SFT. The current level of the threshold will be kept under review as part of the normal Budgetary and Finance Bill process.