Approved Retirement Fund

Approved Retirement Fund The ITC ARF is a post-retirement investment vehicle. Subject to Revenue’s minimum distribution rules, the ITC ARF leaves it up to you to decide whether, or how much, you wish to draw from your retirement fund. It gives you complete freedom as to where you wish your retirement funds to be invested. It usually allows for the investments in your pension scheme to be brought into retirement with you.

The ITC ARF lets you place some, or all, of your pension fund value, depending on your preference, in a wide range of investments. These could be a deposit account, a share portfolio with a stockbroking house, a tenanted property, an investment in a managed fund with a life company, a tracker bond or a combination of any or all of these. You are then free to draw a regular income from the fund if you so choose.

Who can set up an ITC ARF?

The following pension investors may avail of the ARF option at retirement:

• Personal Pension Plan investors (investors who have a pension policy with a life company);
• Personal Retirement Savings Account (PRSA) investors;
• Members of Small Self-Administered Schemes;
• Members of employer-sponsored pension schemes who have made Additional Voluntary Contributions (AVC);
• Members of employer-sponsored Defined Contribution pension schemes, subject to the terms of the scheme; and
• Holders of Buy Out Bonds.

What is an Approved Minimum Retirement Fund (AMRF)?

An Approved Minimum Retirement Fund (AMRF) is a separate fund carved out from the ARF for people below the age of 75 who:

  • do not have an annual pension income of at least €12,700; or
  • do not hold funds in an AMRF already; or
  • have not invested the AMRF amount of €63,500 in an annuity.

For all intents and purposes, the operation of the AMRF is similar to that of the ARF in that the funds can be invested in any number of ways, subject to Revenue rules. The main restriction in relation to an AMRF is the drawing down of benefits. Up to 4% of the value of the AMRF can be accessed annually. If, before reaching the age of 75 years, you have specified income of €12,700 for example, your AMRF becomes an ARF.

What are the benefits of an ITC ARF?

Many ARF investments currently on offer are either asset or fund specific, meaning that you must invest your ARF funds in specific asset classes, such as commercial property. Alternatively, the ARF offerings from certain life companies may restrict you to investing in one or more of a number of funds. More often than not, you will find that you become tied to a life company ARF provider for a number of years and that generous initial allocation rates are matched by severe penalties if you decide to change provider.

The ITC ARF/AMRF is different.  It offers you the flexibility to invest your post-retirement funds in the assets of your choice - with no restriction on asset classes, products or investment funds. (Of course, this is subject to the relevant legislation and Revenue rules.) 

You can determine the assets in which your ARF is invested.
There are no allocation rates and no penalties if you decide to change provider.
The ITC ARF is managed in an entirely transparent manner.

Next steps

  1. Contact us or your Financial Advisor.
  2. To download the ARF brochure and application pack please visit Product Downloads

  3. Take a look at our FAQ section for further details.