Clause may save high earners from extra taxes

A GET-OUT clause that may save high earners from paying extra taxes on their pension funds after last month’s budget was included for fear of legal challenges.

The clause, which allows those close to retirement to protect their fund from heavy additional taxes, could allow retiring Government ministers to escape the new charges when they leave the Dáil at the general election.

In the budget, Finance Minister Brian Lenihan more than halved the “standard fund threshold” — the value a pension fund must reach before it becomes subject to taxes — from €5.4 million to €2.3m.