State pension from Rental Income

pod6611

Hi,

My wife who is UK born moved to Ireland a few years ago after we got married. If she had rental income in Ireland and it was her only income:
1. Would the PRSI payment qualify for state contributory pension contributions
2. If yes is there a minimum income or PRSI contribution have to be made to qualify toward pension.

3. Also my wife is in her late forties. If she contributes PRSI through rental income up to retirement age would she be entitled to the full state contributory pension? My understanding is that if rental income qualifies then as she would only be starting paying tax from now onwards in Ireland for the first time the clock would only start now. She would be making an average of over 48 payments per year for greater than the required 10 years - therefore she would qualify for full state pension?

Apologies for my ramblings. Thanks.

mp22

Moved from state benefits

Squatter

Q1. Would the PRSI payment qualify for state contributory pension contributions

Possibly, subject to two provisos:-

1. she doesn't fall into one of the exclusion categories:-

"Certain categories of persons are excluded from paying Class S. The legislation covering this is Part III of the First Schedule of the Social Welfare (Consolidation) Act, 2005.

The following are some examples:

.....................
Persons with reckonable annual income of less than €5,000

Persons who pay contributions at Class A and whose only self-employed income is unearned income such as interest or rent **

Persons in receipt of an Occupational pension (pension from previous employment) whose only self-employed income is unearned income such as interest or rent **

Public servants paying Class B, C or D who are also self-employed *

Persons not ordinarily resident in the State with solely unearned income."

Clarification of a person's insurable status should be sought from Scope Section, Gandon House, Amiens Street, Dublin 1, Ph (01) 704 3000.

Proviso 2 is that she would need to have paid a minimum Class S contribution of €500 per annum* since 2013 for her contributions to be reckonable for the Contributory Pension.

* prior to 2013, the minimum annual contribution for pension eligibility was €253.


3. Also my wife is in her late forties. If she contributes PRSI through rental income up to retirement age would she be entitled to the full state contributory pension?

Here again, the requirements for her to be an eligible person and to pay the minimum €500 Class S PRSI annually contribution would apply.

If she's in her late 40's she may not have enough time to qualify for the full Contributory pension which, from 2020, will require 30 years paid contributions.

As an alternative, she should look into making voluntary Class S contributions.

It would be helpful if you were to obtain a copy of her PRSI record, see how here:-

https://www.welfare.ie/en/Pages/secure/RequestSIContributionRecord.aspx

pod6611

Thanks Squatter.

A very thorough response.

Subject to my wife not falling into one of the exemptions then my understanding of what you are saying is that she would need to be paying a minimum of 500 euro PRSI which would necessitate a rental income of 12,500 euro (based on 4% PRSI rate). Her rental income would be about 6,000 euro leaving a shortfall. My understanding is that she can only pay voluntary contributions after 10 years actual real income based contributions. Unfortunately she has no contributions made to date. It therefore looks like this is a non runner for her however I will follow up with the 2 groups you mentioned.

Thanks again.

CIARAN_BOYLE

once income is above 5k and she is a chargeable person she has to pay thr minimum amountm