Pensions

[John m]

Minister for Social Protection Heather Humphreys is bringing proposals to Cabinet to ensure the State pension age remains at 66 - rather than 68 as recommended by the Pension Commission.

It is understood Ms Humphreys is also recommending a flexible pension age, in which people who choose to work beyond 66 years of age receive higher rates of pension payment.

The weekly State pension would increase from €253 for 66-year-olds to €266 for 67-year-olds; €281 for 68-year-olds; €297 for 69-year-olds; and €315 for 70-year-olds - a combined 24% increase.

Long-term carers will be able to qualify for a contributory pension for the first time.

It is understood that the amount by which PRSI would have to increase to fund the initiative will only be determined later in the year, following an actuarial review.

However, a source has told RTÉ News that there would be no PRSI increase in the forthcoming budget, and possibly not in the following budget due to the cost-of-living crisis.

The new system would require new legislation and IT systems, so it is understood that the measures will come into force in January 2024.

Setting the pension age is a political hot potato which caused chaos in the last General Election and has been a source of some controversy between the Coalition parties.

Last July, Taoiseach Micheál Martin said he believed the State pension age should not go beyond the age of 66, saying there was a "clear groundswell" within his party to retain it.

The previous September, Tánaiste Leo Varadkar told his Fine Gael party that he would oppose massive PRSI hikes for the self-employed, designed to help pay the State pension.

It is understood the minister's motivation in backing a flexible model, rather than compelling people to retire at 66, is because the qualification for a pension is an arbitrary date and the policy is not in line with EU norms.

[John m]

I wonder what the deal will be for self employed .If we take the pension at 66 and continue to Work and pay tax and PRSI will we get anything extra when we retire ?

[Belker]

I'm not good at social welfare stuff.

"The weekly State pension would increase from €253 for 66-year-olds".

But do the state pay me 253 when I hit 66, regardless if I'm working or not ?

[Cool Boola]

You can start receiving your state pension from your state pension age (currently 65 and increasing to 67 from 2028) regardless of whether you choose to retire then or not.

[Bob Shillin]

I wonder what the deal will be for self employed .If we take the pension at 66 and continue to Work and pay tax and PRSI will we get anything extra when we retire ?

Currently no PRSI for pensioners working or not, although a think tank has advised introducing same.

[watty]

@ JohnM:  I think you'd hvae to see a specialist about questions like that.  The whole area is incredibly complicated (see link at bottom) and any general advice you get on here is likely to be wrong or out of date by the time you retire.

I'm not good at social welfare stuff.

"The weekly State pension would increase from €253 for 66-year-olds".

But do the state pay me 253 when I hit 66, regardless if I'm working or not ?

Depends on your stamps.  if you have enough stamps, you get (what I call) a no-questions asked full pension (contributory).  If you're short, it's means-tested and you might not get the full whack (non-contributory).



https://www.citizensinformation.ie/en/social_welfare/social_welfare_payments/older_and_retired_people/state_pension_contributory.html
The State Pension (Contributory) is paid to people from the age of 66 who have enough (PRSI) contributions. It is sometimes called the old-age pension.  The State Pension (Contributory) is not means tested. You can have other income and still get it.

[Belker]

I'm not good at social welfare stuff.

"The weekly State pension would increase from €253 for 66-year-olds".

But do the state pay me 253 when I hit 66, regardless if I'm working or not ?

Depends on your stamps.  if you have enough stamps, you get (what I call) a no-questions asked full pension (contributory).  If you're short, it's means-tested and you might not get the full whack (non-contributory).

I have made tax returns every year since I was 15 fer the past 42 years, so I'm guessing that would qualify me on the stamp thing ?

[John m]

The new rule in a nutshell .You need 40 years contribution UK or EU stamps apply as well .If you have 40 years full stamps you get 100% Contributory pension .But if you dont I need to check if you were on the Dole and Credited a stamp are they treated as Full Stamps .so lets say you have 30 years full stamps and 10 years credits .You may possibly get 75% Contributory Pension and the other 25% will be means tested .So if you continue to work after 66 you may lose the Means tested amount of your Old age Pension .If you have a My Welfare page you can go in and request your PRSI contribution status .Last year we were credited a Covid Stamp and some this year will be below the PRSI thresh hold for 2021 and Prsi Exempt .Might be an Idea to ask the Status of those Credits are they considered Full stamps ?

[watty]

It might be no harm for ye all to get a PRSI statement and you can get it from welfare.ie

I went for an eye test during the year.  Normally the test is free if you've paid stamps but 'the computer' said I had paid NO stamps.  I got on the phone to Welfare and eventually ended up with someone in Waterford.  They looked at the computer and went, 'Oh yeah, we never updated your file'.  Then she pressed a button and, hey presto, I got 52 stamps added to my account 

https://www.citizensinformation.ie/en/social_welfare/social_welfare_payments/older_and_retired_people/state_pension_contributory.html

The rules are really complicated and my next comment relates to the rules from a few months back.  When I looked at it, you needed something like 2080 stamps.  Looking at the statement I got, I think I'm gonna be ~100 stamps short of getting the full contributory pension so I'll be looking to make additional voluntary contributions.

[John m]

Thats sort of what my initial question was if you were short two years 100 stamps could you work till you were 68 and delay taking the Pension pay PRSI and achieve the Full qualifying amount then take your Full Improved Pension two years later if the Sums added up ?Or if you are short take your reduced Pension but continue to work and Pay PRSI are you credited with more full stamps and when you make up the short fall you go on full money ?

[Cool Boola]

You have to make your application to the Government Dept. in Sligo,a year before you are eligible to retire.They will soon tell you,what you are entitled to and when!

[watty]

I think the current proposal to extend the retirement age is just a suggestion at the moment so I don't know how it will work if you're short a few stamps at the 65 or 67 years of age. 

But I want to  make sure I have enough stamps by 65!  The contributory pension (as I understand it) is not means-tested and you get the full whack, no questions asked.  I think you can still work the taxi and just pay extra tax - you keep the full pension.  On the other hand, the non-contributory pension is means-tested and if you have savings or you keep working the taxi, the amount might go down?  I could be wrong on this so that's why I want to talk to an accountant.

[Belker]

I have made tax returns every year since I was 15 fer the past 42 years, so I'm guessing that would qualify me on the stamp thing ?

What is this Stamp thing ye speak of ?

[watty]

stamp = PRSI credit.

[Belker]

I have made tax returns every year since I was 15 fer the past 42 years, so I'm guessing that would qualify me on the stamp thing ?

What is this Stamp thing ye speak of ?

Actually don't answer that, my accountant can work it out if I make it to 66 !