Pension Related Deduction (PRD)

With effect from 01st March 2009 the Pension Related Deduction must be applied to the remuneration of public servants.  

Who does the Pension Related Deduction apply to?

 The Pension Related Deduction applies to public servants who:  

(i) Are members of a public pension scheme 

(ii) Are entitled to benefit under such a scheme 

or 

(iii) Receive a payment in lieu of membership in such a scheme 

 What pay does the Pension Related Deduction apply to? 

The Pension Related Deduction applies to all Schedule E remuneration covering all elements of gross pay, including overtime, arrears, all taxable allowances, Notional Pay on Benefits and taxable portions of Illness Benefit. 

 PRSI Relief on Pension Related Deduction Abolished

 With effect from 1st January 2011 Gross income before the PRD deduction will be subject to PRSI. 

 PRD RATES AND THRESHOLDS 2017

 The exemption threshold for 2017 is €28,750.

 Issuing a P45 to an Employee

 No changes are required to the P45 issued to employees who leave employment from whom a Pension Related Deduction has been deducted, however, a statement of Pension Related Deductions should be issued with the P45 to the employee.

Issuing P45 to an Employee with a Pension Related Deduction within two years of commencement

Where an employee leaves employment within two years and neither transfers to another public service employment nor retains any pension benefits they are due a refund of both the pension contributions and the Pension Related Deduction. Per the Department of Finance this refund is to be calculated manually outside of the payroll software.

SETTING UP THE PENSION RELATED DEDUCTION WITHIN BRIGHTPAY

Go to Employees > Select Employee to whom the deduction will apply > Revenue Details > Select the appropriate PRD calculation method

Payslips

The Pension Related Deduction will display separately on the Employees Payslip as "PRD”