SHOCKING: Expert warns people losing over €100 per week on their State Pension
James Dorrian of the National Pension Helpline outlines how to avoid losing hundreds in tax weekly
People receiving the state pension could be losing hundreds of euros per week, according to a leading financial expert.
James Dorrian of the National Pension Helpline explains that people who have reached the retirement age of 66 but continue to work could be faced with an extra €110 in tax.
Mr. Dorrian said that people on the 40% tax rate could be losing hundreds per week.
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He said: "When you reach the age of 66, you're entitled to an extra €166.38 in your State Pension, however if you're taxed at 40%, you'd be paying an €111 extra in tax per week on your total income.
"This essentially means that of the €277.30 State Pension, you'd only receive around €166."
Mr Dorrian explained that by deferring your pension by a few years, you could save hundreds per month in tax.
"If you're in a position to defer your pension, you'd be saving hundreds of euros per month, because if you're in receipt of an employment pension, you'd likely be taxed at the 20% rate.
"If you have deferred your State Pension for a few years, at 70 years of age you'll be entitled to nearly €270 per week after tax.
"Your total income would be taxed by an extra €72.25 per week, compared to the extra €111 per week when you were 66. This means now that you will be gaining almost €265 per week of additional income of the €337.20 state pension."
James Dorrian concluded: "This of course won't be possible for many people, and the majority of people will be ready to retire at 66 for various reasons – however it's always good to weigh up your options when it comes to retiring."