Caution note on pension deferral

FARMERS need to sit down and plan carefully for the Winter ahead both in terms of fodder needs and cashflow projections according to farm accounts specialists, IFAC (Irish Farm Accounts Co-operative).

Tom O’Farrell, Partner in IFAC, Athenry, told the Farming Tribune that after such a tough Winter and Spring period, followed by the Summer drought, it had been a most difficult year for farmers across the region.

“There are really two important things that all farmers must do over the coming weeks: one is to work out a fodder budget for the Winter period ahead – and secondly, but equally importantly – to put in place a cashflow budget.

“I would also advise farmers to think carefully before deciding to make any adjustments to their pension plans after such a tough year. The higher rate of tax relief still applies and they must also weigh up the impact of any contribution reduction to their overall fund,” said Tom O’Farrell.

Martin Glennon, Head of IFAC’s Financial Solution, has also this week advised farmers to ‘consider very carefully’ any move to defer pernsion payments, even after such a difficult year.

He said that in the current crisis, should farmers decide to sacrifice their pension contributions, the obvious knock-on effect would be a reduction in their pension funds at retirement. Mr. Glennon hile some farmers may think that they will ‘make up’ this investment at a later date but the question has to be to asked: will they receive the same tax relief?

For more, read this week’s Connacht Tribune.

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