Claim income tax relief
Qualifying personal contributions can reduce the income on which you pay income tax, subject to Revenue’s age-related and earnings limits.
For Irish sole traders
Reduce your tax bill with a pension contribution or AVC.
A pension contribution made before you file may reduce the income tax due on your 2025 profits—while putting that money to work for your retirement.
18Nov 2026
Extended ROS deadlineAvailable when you both pay and file through ROS. The standard deadline is 31 October.
Estimate your income tax relief
A quick illustration based on your planned contribution and marginal income tax rate.
€
Illustrative income tax relief€4,000
Net cost €6,000✓Free initial pension consultation
✓Advice tailored to sole traders
✓Central Bank regulated · C154250
One contribution. Two benefits.
Reduce today’s income tax. Build tomorrow’s income.
For a sole trader, a personal pension or PRSA contribution can be one of the most effective ways to use a profitable year more tax-efficiently.
Catch up before filing
A contribution paid before the filing deadline may be claimed against the previous tax year when the required election is made on time.
Invest for retirement
Instead of simply paying more tax, direct eligible money into a pension designed around your retirement goals and attitude to investment risk.
Revenue contribution limits
How much can qualify for income-tax relief?
The maximum personal pension contribution eligible for relief is generally calculated using your age at the end of the tax year and your qualifying earnings.
Annual earnings cap€115,000
| Age | Maximum percentage |
|---|---|
| Under 30 | 15% |
| 30–39 | 20% |
| 40–49 | 25% |
| 50–54 | 30% |
| 55–59 | 35% |
| 60 or over | 40% |
Percentages apply to the lower of qualifying earnings and €115,000. Existing employee, AVC or personal pension contributions may use part of the available limit. Special rules can apply to certain professional sportspersons.
Worked example: sole trader
How a pension contribution can reduce the tax bill
John is 42, has net relevant earnings of €100,000 and pays income tax at the 40% marginal rate. He has no other pension contributions.
Net relevant earnings€100,000
Maximum eligible at 25%€25,000
Pension contribution paid€20,000
Potential income-tax relief at 40%€8,000
The €20,000 contribution could have an effective net cost of €12,000 after €8,000 of income-tax relief, reducing John’s overall income-tax bill by the same amount. USC and PRSI are not reduced. The actual result depends on his final income, tax rate, pension history and available relief limit.
Employees with rental income
An AVC may also reduce the amount due on your tax return.
This can be particularly relevant if you are an employee—such as a public-sector employee—with residential property income and a Form 11 liability. A once-off Additional Voluntary Contribution may qualify for income-tax relief and reduce your overall income-tax bill.
The AVC relief is linked to your earnings from the employment and your occupational pension scheme. Rental income does not increase the amount you can contribute with tax relief, and an AVC is not deducted from the taxable rental profit itself.
Why it can still helpIf PAYE has already been deducted from your salary, claiming qualifying AVC relief can create an income-tax credit. On your overall assessment, that credit may reduce the balance payable that arose because of rental income.
Worked example: public-sector employee and landlord
Illustrative figures only. The employee is aged 45 and pays income tax at the 40% marginal rate.
Employment salary€80,000
Net rental profit€20,000
Once-off AVC€10,000
Age-based ceiling at 25% of €80,000€20,000
Less existing employee pension contributions (assumed)€6,000
Illustrative remaining contribution headroom€14,000
AVC made before the filing deadline€10,000
Potential income-tax relief at 40%€4,000
Important: The €20,000 rental profit remains taxable. The €4,000 relief arises from the employee’s qualifying employment earnings and may reduce the overall income-tax balance payable. It does not reduce USC or PRSI. Existing scheme contributions use part of the age-related limit.
Act before the deadline
A clear plan, without the last-minute rush.
We’ll help you establish what you can contribute, choose an appropriate pension and complete the process in time.
Check my pension options01
Tell us about your position
Share your age, estimated relevant earnings, current pension arrangements and the contribution you are considering.
02
Understand the available relief
We’ll illustrate the potential income tax relief and check the contribution against the applicable Revenue limits.
03
Choose the right pension
We’ll recommend a suitable structure and investment approach based on your needs, timeframe and risk profile.
04
Complete before you file
Make the contribution and ensure the claim or election is dealt with before the relevant self-assessment deadline.
Time remaining to the ROS deadlineFor taxpayers who pay and file online through ROS.
34days
14hours
20mins
41secs
Useful answers
Before you contribute
How much can I contribute and claim tax relief on?
The maximum qualifying personal contribution is generally limited by an age-related percentage of relevant earnings. The percentage ranges from 15% if you are under 30 to 40% from age 60, and the earnings cap is €115,000. Other pension contributions may also use part of your limit.
Does a pension contribution reduce USC or PRSI?
No. Personal pension contribution relief applies to income tax, but not to USC or PRSI. The actual value of relief therefore depends on the income tax rate that applies to you.
Can I claim the contribution against my 2025 income?
A qualifying contribution paid in 2026 before the filing deadline may be claimed for 2025 if you make the required election by the same deadline. Your accountant or tax adviser should confirm the treatment on your return.
What pension options are available to sole traders?
A PRSA or personal pension may be suitable. The right choice depends on factors such as flexibility, charges, investment range, existing benefits and your longer-term retirement plan.
What happens if I already have a pension?
You may still be able to top up an existing plan or contribute to another suitable arrangement, but your total tax-relievable personal contributions remain subject to the relevant limits.
Can an AVC reduce the tax bill arising from rental income?
Indirectly, yes. The AVC relief is granted against qualifying earnings from the relevant employment—not against rental income. However, the resulting income-tax relief or credit forms part of your overall tax calculation and may reduce the Form 11 balance payable, including a balance caused by rental profits.
Does rental income increase my AVC tax-relief limit?
No. Rental income is not employment earnings for this purpose. An employee’s AVC limit is based on the income from the employment linked to the pension arrangement, subject to the age-related percentage and €115,000 earnings cap.
How is the available AVC amount calculated for a public-sector employee?
Start with the applicable age-related percentage of eligible employment earnings, subject to the earnings cap. Employee pension contributions already made to the public-sector scheme—and any existing AVCs—generally use part of that allowance. A personalised calculation is important because contribution structures can vary by scheme and date of entry.
Can I pay a once-off AVC after the end of the tax year?
Potentially. Revenue permits a qualifying once-off contribution paid before the following filing deadline to be elected back to the earlier tax year. The contribution and the election must both be completed by the applicable deadline; the ROS extension can apply where the relevant online requirements are met.
How do I claim AVC relief when completing Form 11?
Revenue’s Form 11 guidance directs taxpayers to claim AVC relief through the “PAYE/BIK/Pensions” panel. Keep the pension provider’s contribution certificate and confirm the entry with your accountant or tax adviser.
MORE HELPFUL GUIDES & ADVICE
Guides for Sole Trader Pensions
CLIENT TESTIMONIALS
What Our Clients Say
Don’t leave it until filing day
Find out what you can contribute before the deadline.
Book a free consultation with a qualified MMA adviser. We’ll give you a clear, personalised view of your pension options and potential tax relief.
Money Maximising Advisors Limited
Unit 3, Office 6, Liosban Business Park, Tuam Road, Galway, H91 85A0. Money Maximising Advisors Limited is regulated by the Central Bank of Ireland – C154250.
This page is for general information only and does not constitute tax, legal or investment advice. Pension benefits and tax relief depend on individual circumstances, Revenue rules and limits. Tax treatment may change. Investment values can fall as well as rise.