Glossary of pension terms

Choose a letter below to jump to glossary terms beginning with that letter.

Paid-up benefit

A benefit secured for an individual member under a contract of insurance whose contributions have ceased to be payable in respect of that member. One form of deferred benefit.

Paid-up scheme

A pension scheme where no further contributions are being paid, but whose assets continue to be held by the trustees and applied under its rules.

Participating employer

An employer whose employees are members of a pension scheme. Used where pension schemes cater for more than one employer.

Past service

Service completed before a given date, usually the date of a pension scheme valuation.

Past service benefit

The benefit granted in respect of past service.

Past service reserve

A term describing the present value of all benefits accrued to the date of the calculation, by reference to projected earnings.

Pay parity

A term used to describe the system of increasing pensions in payment and deferred pensions in line with the pay for the post held by the scheme member before retirement or leaving service, as appropriate.


Often abbreviated to PAYG, this is the method of financing pension promises out of the current income of the employer, there being no advance funding of the pension liabilities. It is used for social welfare schemes and for many (though not all) public sector occupational schemes. See also ‘unfunded scheme’.

Pension adjustment order (PAO)

An order made following a decree of judicial separation or divorce whereby the court:

  • adjusts a member’s pension scheme rights in favour of their spouse/civil partner/qualified cohabitant or a dependent child, or
  • makes a nominal or ‘nil’ PAO whereby a member’s pension benefits are effectively not adjusted – instead the value of pension benefits can be taken into account in the making of court orders relating to other assets.

Pension fund

This is the assets of the pension scheme, but the term is very often used for the pension scheme itself.

Pension plan

Another term for pension scheme.

Pension scheme

A term used by the Pensions Authority to refer to occupational pension schemes and trust retirement annuity contracts collectively, i.e., arrangements which typically provide retirement benefits for members with or without benefits for their dependants in the event of death.

Pensionable employment

Employment may be referred to as pensionable if the individual is a member of an occupational pension scheme as a consequence of that employment.

Pensionable salary

The earnings or salary on which contributions, pensions and lump sum benefits are typically calculated in a pension scheme.

Pensionable service

The period of service which is taken into account in calculating the pension benefit.

Pensioneer trustee

A Revenue term. Trustee boards of a small self-administered pension scheme, as defined in the Revenue Pensions Manual, must include a Revenue approved ‘pensioneer trustee’. Please refer to the Revenue Pensions Manual for further information. See also ‘small self-administered pension scheme’.


A member who is currently receiving payment of a pension from a pension scheme.

Pensioner member

A person being paid from a pension scheme (also called a pensioner).

Pensions (Amendment) Act, 1996

An Act which introduced extensive amendments to the Pensions Act, extending the powers of the Pensions Authority and introducing ‘whistle-blowing’ obligations on certain persons involved in pension schemes. The persons subject to whistle-blowing obligations now also include certain persons involved in PRSAs and trust RACs, registered administrators and key function holders since later legislation was passed in 2003, 2008 and 2021 respectively. For further information, see the Pensions Authority’s guidance entitled ‘Compulsory and voluntary reporting to the Pensions Authority’ available on this page.

Pensions (Amendment) Act, 2002

An Act which extended the Pensions Act, by increasing preservation rights for early leavers, introducing a framework for PRSAs and establishing the office of the Pensions Ombudsman (now the Financial Services and Pensions Ombudsman).

Pensions Act

The Pensions Act, 1990, as amended, is the principal piece of pensions legislation in Ireland and has been considerably amended and extended since 1990.

Pensions Authority

The Pensions Authority is the statutory body that supervises compliance with the requirements of the Pensions Act, by trustees of occupational pension schemes and trust retirement annuity contracts, personal retirement savings account providers, registered administrators and employers. The Pensions Authority also provides guidance and information to these parties on their duties and responsibilities and advises the Minister for Social Protection on pension matters.

Pensions Authority monitoring tools

Section 26K of the Pensions Act requires the Pensions Authority to have one or more monitoring tools in place to enable it to identify deteriorating financial conditions in a pension scheme and also to monitor how that deterioration is remedied. The Authority may request certain information from the trustees of a pension scheme where it wishes to apply a monitoring tool to a pension scheme and the trustees must provide that information. See also defined benefit financial risk measure.

Pension benefit statement (PBS)

A pension benefit statement (PBS) is an annual statement issued to members of pension schemes (excluding unfunded public sector schemes) who have not yet retired, including deferred members, i.e., members who have left service with an entitlement to retirement benefits payable at a future date.

The PBS must contain certain key information, including information on the pension benefits a member has already built up and the pension benefits that might be paid if the member continues in the pension scheme until retirement.

Pensions Data Register (PDR)

The Pensions Authority’s Pensions Data Register (PDR) is the national register of pension schemes. PDR holds data on all occupational pension schemes and allows registered administrators (RAs) and interested parties (external users) to manage and submit data electronically to the Authority through an online services portal. PDR provides the Authority with the capability to fully administer the register and all recorded information via a comprehensive back office application. The desktop application is deployed across the Authority and is used by staff on a daily basis.

 Data that can be submitted through PDR includes:

  • Scheme registrations.
  • Annual scheme information submissions.
  • Actuarial funding certificate submissions.
  • Funding standard reserve certificate submissions.
  • Annual actuarial data returns.
  • Scheme fee payments.
  • Scheme data amendments and updates (e.g., names of trustees, etc.).

Pensions Ombudsman (now Financial Services and Pensions Ombudsman)

An officer appointed under the Financial Services and Pensions Ombudsman Act, 2017, whose functions include the investigation and adjudication of complaints arising from the conduct of a pension provider involving alleged financial loss by an act of maladministration or any dispute of fact or law.

Personal pension contract

A retirement savings contract, usually with an insurance company, providing benefits at retirement. Personal pension contracts may be taken out by those who are self-employed or who are in non-pensionable employment. There are two forms of personal pension contracts: personal retirement savings accounts (PRSAs) and retirement annuity contracts (RACs). PRSAs can also be used by people in pensionable employment who wish to make additional voluntary contributions. The tax treatment of contributions, maximum benefits and drawdown options for RACs are broadly the same as for PRSAs.

Personal retirement bond (PRB)

Also known as a ‘buy out bond’ or BoB, a personal retirement bond (PRB) is a special type of personal pension contract, where the only premium payment comes from a transfer payment from an occupational pension scheme. Rules around accessing PRB funds reflect the rules of the transferring pension scheme. The value of a PRB at retirement depends on the transfer payment amount and the investment return achieved over the term to retirement. Generally, individuals can take a tax-free lump sum from a PRB and use the remaining funds to buy an annuity (pension) or invest in an approved retirement fund. Revenue restrictions apply.

Personal retirement savings account (PRSA)

A personal retirement savings account (PRSA) is a personal retirement savings contract that any individual can take out with an authorised PRSA provider. It is effectively an investment account used to save for retirement and savings can only be accessed at retirement. PRSAs are a type of defined contribution arrangement. Income tax relief is given on contributions to a PRSA, within limits set by Revenue. Revenue also set rules regarding how and when retirement savings can be accessed. Further information on these matters can be found in the Revenue Pensions Manual. A register of authorised PRSA providers and their approved PRSA products is available on the Pensions Authority website. The Authority has also published a guide to PRSAs, available here.

Pooled funds (also known as ‘managed funds’)

These are collective investment schemes in which investors’ money is pooled to buy a portfolio of assets, including government bonds, deposits, property and stocks.

Preliminary poll

A poll held under the ‘member participation in the selection of trustee regulations’ to determine whether members wish to appoint trustees by means of the ‘standard arrangement’ or whether they wish to accept an ‘alternative arrangement’ offered by the employer.


Describes the obligation which trustees have under the Pensions Act, to retain benefits in a pension scheme for members who finish their employment before normal pensionable age having completed two years’ qualifying service or more. The benefits, known as ‘preserved benefits’, may be held within the scheme or transferred out of the scheme at any time before retirement. Note that the qualifying period for a preserved benefit was previously five years and was reduced to two years for those who finished their employment since 1 June 2002. Different rules apply for members of a scheme whose employment terminated before 1 June 2002.  Please refer to the Pensions Authority’s ‘Preservation of benefits and minimum value of contributory retirement benefits’ guidance, which can be found here.

Preserved benefits

A statutory entitlement to a preserved benefit is provided under the legislation to a member of an occupational pension scheme who satisfies the qualifying condition and whose service in relevant employment terminates before retirement for any reason other than death. The qualifying condition is currently that a member must have completed at least two years’ qualifying service. The qualifying period was previously five years and was reduced to two years for those who finished their employment since 1 June 2002. Different rules apply for members of a pension scheme whose employment terminated before 1 June 2002. For further information about preserved benefits, refer to the Pensions Authority’s ‘Preservation of benefits and minimum value of contributory retirement benefits’ guidance, which can be found here.

Principal employer (also known as ‘the sponsoring employer’)

Commonly used in pension scheme documentation for the particular participating employer which is given special powers or duties in areas such as the appointment of trustees, rule amendments and winding up. Usually the employer that started the pension scheme or, in a pension scheme catering for many unrelated employers, one chosen as a proxy for all.

Principle of equal pension treatment

This principle dictates that there shall be no discrimination on any of the nine discriminatory grounds in respect of any rule of a pension scheme. The nine discriminatory grounds are gender, civil status, family status, sexual orientation, religious belief, age, disability, race and membership of the travelling community.

Priority liabilities

In the event of the wind-up (termination) of a defined benefit pension scheme, the trustees of the pension scheme must ensure that the wind-up is carried out in accordance with the rules of the pension scheme and the Pensions Act. Where the pension scheme has a deficit, the Pensions Act sets out the order of priority in which assets must be distributed, depending on whether the sponsoring employer is solvent or insolvent.

The ‘single insolvency order’ will apply if the pension scheme sponsor (the employer) is solvent at the date of wind up. Under the single insolvency order, benefits will be distributed in the following order of priority:

  1. Additional voluntary contributions (AVCs) and transfers in of AVCs; and defined contribution (DC) benefits and transfers in of DC benefits.
  2. Pensioner benefits (excluding post-retirement increases), in accordance with the following limits:

(a) the annual pension is €12,000 or less, 100% of the pension;

(b) if the annual pension is more than €12,000 and less than €60,000, the greater of €12,000 and 90%
of the pension; and

(c) if the annual pension is €60,000 or more, the greater of €54,000 and 80% of the pension.

  1. 50% of active and deferred benefits, excluding post-retirement increases.
  2. Remaining pensioner benefits, excluding post-retirement increases.
  3. Remaining active and deferred benefits, excluding post-retirement increases.
  4. Any remaining benefits, including post-retirement increases.

If the employer itself is insolvent, the ‘double insolvency order’ will apply.

For further information, please see the Pensions Authority’s guidance notes entitled ‘Social Welfare and Pensions (No. 2) Act, 2013’, available on this page.

Prospective member

An employee who is or will be eligible to join the pension scheme.


Also known as an ‘AVC PRSA’, means a personal retirement savings account designed to be used for additional voluntary contributions by members of occupational pension schemes. An AVC PRSA is linked to the main pension scheme.

PRSA provider

An authorised investment firm, life assurance company or credit institution which produces, markets or sells PRSA products.

Prudential supervision

All pension schemes are subject to prudential supervision by the Pensions Authority. This includes supervision of:

  • a pension scheme’s governance system, i.e., compliance with the ‘fit’ and ‘proper’ requirements, the risk and internal audit function requirements, the own-risk assessment requirement, outsourcing rules and depositary rules,
  • the operation of the scheme,
  • investment rules,
  • investment management, and
  • the information to be provided to members.

As part of its prudential supervision, the Authority must carry out a supervisory review of a pension scheme to assess the system of governance, the risks faced by a scheme and the management of those risks. The approach to prudential supervision must be forward-looking and risk-based, and it must comprise a combination of off-site activities and on-site inspections. See Part IIA of the Pensions Act.

Public authority pension scheme

A statutory scheme to which section 776 of the Taxes Consolidation Act, 1997 applies or a scheme where benefits are paid for in whole or in part from central funds or moneys voted by the Oireachtas, and which provide for an appeal to a Minister for the resolution of disputes prior to referral to the Financial Services and Pensions Ombudsman.

Public sector pension scheme

An occupational pension scheme for employees of central or local government, statutory and other semi-state bodies. Many of these schemes are not funded and pension benefits are paid as they fall due by the State from current spending.