Glossary of pension terms

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

Target benefit scheme

A form of defined contribution pension scheme which aims for, but does not guarantee, a particular level of benefit. Commonly, contributions paid to such pension schemes are reviewed at regular intervals and adjusted to take account of factors such as pay increases and investment returns in the period between reviews.

Temporary annuity

An annuity payable for a fixed term or until earlier death. Also called a ‘term annuity’.

Temporary cash holdings

Short-term deposits that are secure.

Term assurance policy

A policy which provides a lump sum on death before a fixed future date. Such policies are frequently used for the provision of pension scheme lump sum benefits payable on death in service.

The Pensions Authority

The Pensions Authority is the statutory body that supervises compliance with the requirements of the Pensions Act, 1990, as amended, by trustees of occupational pension schemes and trust RACs, PRSA 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.

Transfer payment (also known as ‘transfer value’)

A member of a pension scheme who is entitled to a preserved benefit is entitled to take a transfer payment from that pension scheme to:

  • another pension scheme of which they are a member or prospective member,
  • a buy-out bond, also known as a ‘personal retirement bond’, with an insurance company, or
  • a personal retirement savings account (PRSA) with a PRSA provider,

in lieu of the benefits payable to the member from the pension scheme from which the transfer payment is made.

In the case of a defined benefit pension scheme, the transfer payment is the actuarial value of the deferred pension (preserved benefit). This may be reduced to reflect the funding position of the pension scheme. In the case of a defined contribution pension scheme, the transfer payment is the accumulated value of contributions paid by or in respect of the member.

Traveller community ground

Discrimination by reference to membership of the traveller community is discrimination on the traveller community ground under the Pensions Act. Traveller community means the community of people commonly so called who are identified by both themselves and others as people with a shared history, culture and traditions including historically a nomadic way of life on the island of Ireland.

Trivial pension

A pension which is small enough that it can be fully commuted (converted to a cash lump sum) without prejudicing the approval of the scheme by Revenue. Further details can be found in chapter 7 of the Revenue Pensions Manual.


To qualify for full tax approval, funded pension schemes must normally be set up as irrevocable trusts. A trust is an arrangement under which a person or a group of people (trustees) hold and look after property on behalf of others. The property is called a trust fund and the people on whose behalf the trust fund is held are called beneficiaries. In the case of a pension scheme set up as a trust, the assets are held by the pension scheme trustees for the benefit of the members and beneficiaries of the pension scheme.

Trust deed

The legal document, executed in the form of a deed, which establishes, regulates or amends a trust.

Trust deed and rules

Occupational pension schemes are set up under trust. The trust deed and rules govern how the pension scheme is managed and sets out how the benefits are determined and to whom they are payable . The Pensions Act is overriding however, i.e., it applies even if the trust deed and rules do not contain a corresponding provision or provides something different.

Trust fund

In a company pension scheme, the trust fund is the monies and assets held by the trustees, subject to the trusts of the pension scheme.

Trust law

Trust law comprises a number of statutory provisions dating back to the Trustee Act, 1893, and principles of equity which have evolved over many years in cases decided in the courts.

Trust RAC

A trust RAC is a scheme established under trust and approved by Revenue under section 784(4) or section 785(5), Chapter 2, Part 30 of the Taxes Consolidation Act, 1997. In these arrangements a trust is set up for individuals in or connected with a particular occupation or occupations by a body comprising or representing the majority of the individuals. The trust enters into retirement annuity contracts (personal pensions) on a collective basis for the members of the group. Trust RACs are established on a defined contribution basis.


In the context of pension schemes means an individual or a company which alone, in the case of a company, or jointly becomes the legal owner of assets to be administered for the benefit of pension scheme members and beneficiaries in accordance with the provisions of the document creating the trust, the provisions of trust law generally and the Pensions Act which is overriding. Since the second EU pensions directive was transposed, the Pensions Act requires there to be a minimum of two trustees for each pension scheme, or two directors in the case of a sole corporate trustee.

Trustee training

Trustees of pension schemes are required under section 59AA of the Pensions Act to receive appropriate training within six months of their appointment and at least every two years thereafter. Further details are available here.