If you’re a company director or business owner in Ireland, your pension world changed in April 2026. Executive pensions — the single-member schemes that most directors relied on for decades — are gone. The EU’s IORP II regulations closed the door on them, and if you haven’t already moved, the options in front of you are clear: a Master Trust Occupational Pension Scheme, or a PRSA — a Personal Retirement Savings Account.
Both can do the job. But they work very differently, and choosing the wrong one can cost you — either in tax relief you can’t access, flexibility you don’t have, or contributions you’re not allowed to make. Here’s a plain-English comparison to help you understand the difference.
First — why did Executive Pensions disappear?
Executive pensions were single-member occupational pension schemes. They were popular with directors because they allowed large, flexible contributions and gave the director full control over investments. But EU rules — known as IORP II — introduced strict governance and compliance requirements that made it impractical for small, one-member schemes to continue operating. The Pensions Authority gave existing schemes a five-year window to transition, and that window closed on 22 April 2026. New executive pensions haven’t been available since July 2022. The two compliant alternatives are now the Master Trust and the PRSA.
What is a Master Trust?
A Master Trust is a type of occupational pension scheme where many employers — from large companies to small businesses — participate under a single scheme governed by professional trustees. Instead of running your own pension scheme with its own trustees, compliance obligations, and governance requirements, you join an established structure where all of that is handled for you. Think of it as sharing the infrastructure of a large pension scheme while still having your own individual pension pot within it. The trustees are responsible for governance and compliance with Pensions Authority rules — you, as the employer, simply make contributions.
What is a PRSA?
A PRSA — Personal Retirement Savings Account — is a personal pension that you own in your own name. It’s not an occupational scheme. There are no trustees. You set it up through a pension provider, and both you and your company can contribute to it. Since the Finance Act 2022 removed the benefit-in-kind charge on employer contributions to PRSAs, they became far more attractive for directors and business owners. Your company can now make pension contributions to your PRSA and get full corporation tax relief, without those contributions being treated as a taxable benefit in your hands.
How do contributions compare?
This is one of the most important differences between the two structures. A Master Trust uses what’s called the funding standard — an actuarial calculation based on your age, salary, years of service, and the level of benefit you want to achieve at retirement. This can allow very significant contributions, particularly for older directors with long service histories. A PRSA, by contrast, is capped at 100% of your salary per year (a limit introduced from January 2025). For most directors that’s a meaningful ceiling — but for those who want to make very large catch-up contributions, particularly in the final years before retirement, a Master Trust may allow significantly higher funding than a PRSA. For example, a director in their late 50s on a high salary with many years of service could potentially contribute substantially more through a Master Trust than the PRSA salary cap would allow.
How do they compare on flexibility?
The PRSA wins clearly on flexibility. You can hold multiple PRSAs and access them at different ages — from age 60 onwards — which allows a phased retirement approach. You draw on one pot, leave the others to continue growing, and manage your taxable income in retirement more precisely. The Master Trust is less flexible in this regard. You must generally vest all your benefits at the same time — there’s no staged drawdown across multiple pots. Early access from age 50 is possible under a Master Trust, but only if you have left the employment AND relinquished at least a 20% shareholding in the company. For many owner-directors, that’s a significant restriction.
What about portability?
The PRSA is fully portable. It belongs to you personally, moves with you if you change employment, and can be maintained even if you start a new company or hold multiple directorships. The Master Trust is tied to an employment relationship. If you leave the employer — or if the company winds down — the pension remains as a deferred benefit within the Master Trust, but you cannot continue contributing to it in that role. You would need to join a new Master Trust through a new employment arrangement.
How does each one work at retirement?
At retirement, both structures broadly offer the same options: a tax-free lump sum and then a choice between an Approved Retirement Fund (ARF) or an annuity. The tax-free lump sum from a Master Trust is typically calculated as 1.5 times your final salary (if you have at least 20 years of service), which can be more generous than the PRSA’s 25% of the fund. The PRSA gives you 25% of the total fund value as a tax-free lump sum. For larger funds, this can still represent a very significant tax-free payment — particularly as the Standard Fund Threshold has now risen to €2.2 million (as of January 2026) and continues rising to €2.8 million by 2029.
Which one should you choose?
There’s no universal answer — and anyone who tells you otherwise without knowing your situation isn’t giving you advice, they’re giving you a guess. That said, as a general guide: if you’re an older director on a high salary with many years of service who wants to make large catch-up contributions in the run-up to retirement, a Master Trust is often the better choice, because the funding standard allows higher contributions than the PRSA salary cap permits. If you’re a younger director, a director with multiple companies, or someone who values flexibility and portability above all else, a PRSA is often more practical. It’s simpler to set up, easier to administer, and the phased drawdown options in retirement give you much greater control over your tax position.
The growth of Master Trusts in Ireland
It’s worth knowing that Master Trusts have grown rapidly in Ireland — assets under management rose from €13.9 billion in June 2023 to €35.2 billion by June 2025, and the number of participating employers doubled from 15,000 to 30,000 over the same period. PRSAs have grown significantly too, with €21.5 billion held in PRSAs at the end of October 2025. Both are now well-established, regulated structures with strong oversight from the Pensions Authority. Whichever you choose, you’re not taking a risk on an untested product — you’re choosing between two mature, well-regulated options that each suit different circumstances.
If you had an executive pension and haven’t yet transitioned — or if you’re setting up a pension as a director for the first time — the decision between a Master Trust and a PRSA is worth getting right from the start. We help directors across Ireland navigate exactly this choice every day. Get in touch and we’ll walk you through the comparison based on your specific age, salary, shareholding, and retirement plans.
Master Trust vs PRSA — At a Glance
Who it suits — Master Trust: directors seeking maximum contributions, and older directors with long service. PRSA: directors valuing flexibility, portability, or who have multiple companies.
Contribution basis — Master Trust: actuarial funding standard, with no fixed salary cap. PRSA: capped at 100% of salary per year (from January 2025).
Employer tax relief — Both offer full corporation tax relief.
Benefit-in-kind — Master Trust: no BIK on contributions. PRSA: no BIK on contributions (since the Finance Act 2022).
Early access — Master Trust: from age 50, but you must leave the employment and relinquish a 20%+ shareholding. PRSA: from age 60 (PAYE retirees from age 50).
Phased retirement — Master Trust: you must vest all benefits simultaneously. PRSA: multiple PRSAs can be accessed at different ages.
Portability — Master Trust: tied to the employment relationship. PRSA: fully portable — you own it personally.
Tax-free lump sum — Master Trust: up to 1.5x final salary (with 20+ years’ service). PRSA: 25% of fund value.
Administration — Master Trust: professional trustees handle governance. PRSA: simpler, with no trustees required.
Post-retirement options — Both offer an ARF or an annuity.
Regulated by — Master Trust: the Pensions Authority (IORP II compliant). PRSA: the Pensions Authority and the Central Bank of Ireland.
Rules current as at July 2026. Always seek professional advice before making pension decisions.
Master Trust: directors seeking maximum contributions, and older directors with long service. PRSA: directors valuing flexibility, portability, or who have multiple companies.
Master Trust: actuarial funding standard, with no fixed salary cap. PRSA: capped at 100% of salary per year (from January 2025).
Both offer full corporation tax relief.
Master Trust: no BIK on contributions. PRSA: no BIK on contributions (since the Finance Act 2022).
Master Trust: from age 50, but you must leave the employment and relinquish a 20%+ shareholding. PRSA: from age 60 (PAYE retirees from age 50).
Master Trust: you must vest all benefits simultaneously. PRSA: multiple PRSAs can be accessed at different ages.
Master Trust: tied to the employment relationship. PRSA: fully portable — you own it personally.
Master Trust: up to 1.5x final salary (with 20+ years’ service). PRSA: 25% of fund value.
Master Trust: professional trustees handle governance. PRSA: simpler, with no trustees required.
Both offer an ARF or an annuity.
Master Trust: the Pensions Authority (IORP II compliant). PRSA: the Pensions Authority and the Central Bank of Ireland.
Important information: Rules current as at July 2026. Always seek professional advice before making pension decisions. Gen Z Financial Solutions Limited trading as Pension Advice is regulated by the Central Bank of Ireland.
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Gen Z Financial Solutions Limited trading as Pension Advice is regulated by the Central Bank of Ireland.
Frequently Asked Questions
Can a company director contribute to both a Master Trust and a PRSA at the same time?
Generally, no. You cannot be an active contributing member of an occupational pension scheme (which a Master Trust is) and a PRSA simultaneously, for the same employment. However, if you hold multiple directorships across different companies, it may be possible to have a Master Trust through one company and a PRSA through another. This is a nuanced area that depends on your specific corporate structure and Revenue rules, so professional advice is essential before attempting this approach.
My executive pension is still in place after the April 2026 deadline. What happens now?
If your executive pension has not been transitioned by the April 2026 deadline, the scheme is likely to be frozen — meaning you can no longer make contributions and you will lose tax relief on any future pension funding through that arrangement. The Pensions Authority may also take enforcement action against the trustees. If this applies to you, the priority is to act now. A pension adviser can help you transfer the existing fund to either a Master Trust or PRSA as quickly as possible, and ensure that no further tax relief is lost in the meantime.
What does 'vesting all benefits simultaneously' mean in a Master Trust, and why does it matter?
In a Master Trust, when you retire you must access all of your pension benefits at the same time — you cannot draw on part of the fund while leaving the rest invested and growing. By contrast, if you hold multiple PRSAs you can choose to access them in stages — drawing on one pot at 60, another at 63, another at 66 — which gives you far greater control over how much taxable income you receive each year. For higher earners who want to manage their income tax position in retirement carefully, this difference is significant.
Is a Master Trust suitable for a sole trader or self-employed person?
No. A Master Trust is an occupational pension scheme, and occupational pension schemes require an employer-employee relationship. A sole trader does not have that relationship with themselves — they are not an employee of their own business in the legal sense. If you are self-employed, a PRSA is the most appropriate pension structure for you. Company directors who pay themselves a salary through a limited company do have an employer-employee relationship and can therefore participate in a Master Trust through their company.
What is the Standard Fund Threshold and how does it affect my contributions?
The Standard Fund Threshold (SFT) is the maximum value of pension benefits you can accumulate tax-efficiently over your lifetime. It rose to €2.2 million on 1 January 2026 and is set to increase by €200,000 per year, reaching €2.8 million by 2029. Benefits above the SFT are subject to a 40% chargeable excess tax at the point of drawing them. Both Master Trust and PRSA benefits count towards the SFT. For directors with very large pensions or those making significant catch-up contributions, keeping track of where you stand relative to the SFT is an important part of your retirement planning.
Can my company make a large one-off contribution to a Master Trust to fund years I wasn't contributing?
Yes — and this is one of the key advantages of a Master Trust over a PRSA. A Master Trust uses an actuarial funding standard that takes into account your age, salary, years of service, and the target retirement benefit. This allows for ‘back service’ contributions — large one-off payments that fund the years when you weren’t contributing to a pension, with full corporation tax relief. For a director in their 50s who has been running their business for many years without a pension, this can unlock very significant tax-efficient contributions in a short period. A PRSA’s 100% salary cap limits this kind of catch-up funding considerably.
If I move to a Master Trust, what happens to my pension if the company closes?
Your pension pot within a Master Trust is ring-fenced from the company — it belongs to you, not the business. If the company closes or is wound up, your pension benefits within the Master Trust are unaffected and remain protected. However, you would no longer be able to make new contributions in the same capacity. At that point you could leave the benefits as deferred in the Master Trust until retirement, transfer them to a Personal Retirement Bond, or move them to a PRSA. The right approach depends on your age and plans at the time.
Does the removal of the benefit-in-kind charge on PRSA employer contributions apply to all directors?
The removal of the benefit-in-kind charge, introduced by the Finance Act 2022, applies where contributions remain within the 100% of salary annual limit (effective from January 2025). Within that limit, employer contributions to your PRSA are not treated as a taxable benefit — meaning you pay no income tax, PRSI, or USC on them. Above the 100% limit, the excess is treated as a benefit-in-kind and taxed accordingly. This change significantly improved the attractiveness of PRSAs for directors, but the salary cap means it is not the right solution for everyone wanting to make very large contributions.
How long does it take to set up a Master Trust or PRSA?
A PRSA can typically be set up within a few days once your adviser has the relevant information and identification documents — it is a straightforward process with no trustee requirements. A Master Trust takes a little longer, usually one to three weeks, because the employer needs to formally join the scheme, sign the participation agreement, and set up the payroll contribution process. If you are transitioning from an executive pension, the transfer of the existing fund can take an additional four to eight weeks depending on the provider.
Which structure gives me a bigger tax-free lump sum at retirement — a Master Trust or a PRSA?
It depends on your salary and fund size. A Master Trust uses a salary-based formula — the maximum tax-free lump sum is 1.5 times your final salary, provided you have at least 20 years of service. So if your final salary is €100,000 with 20+ years of service, you could receive up to €150,000 tax-free. A PRSA gives you 25% of the total fund value, subject to a lifetime limit of €200,000 for the tax-free portion. For larger funds, 25% may well exceed 1.5 times salary — meaning the PRSA lump sum could be bigger in absolute terms. This comparison is worth running through carefully as part of your retirement planning.
Have a question about your pension?
Speak with a qualified advisor — no obligation, just clear guidance.