Dáil Éireann díospóireacht -
Tuesday, 19 Apr 1994

Vol. 441 No. 5

Written Answers. - Farmers' PRSI Payments.

Edward Nealon

Ceist:

101 Mr. Nealon asked the Minister for Social Welfare if farmers paying PRSI for a number of years but not yet qualified under the ten year rule for a contributory pension can continue to pay the PRSI if they lease their land under the farm retirement scheme and if they hand over their land under the farm retirement scheme so that they will become eligible for a contributory old age pension once they have ceased drawing the farm retirement pension at the age of 70 years; and if he will make a statement on the matter.

Minister for Social Welfare (Dr. Woods)

Under the EU Scheme of Early Retirement from Farming a farmer can transfer his land by gift, lease or sale.

If he leases the land Class S contributions are payable on the income from the lease provided the total reckonable income is £2,500 or more per annum. This will maintain entitlement to pension at age 66 (provided a total of 10 years contributions have been paid). If the farmer is in receipt of income from investment of the proceeds of the sale of the land the same arrangements apply as for income from a lease.

If the only income after transfer of the land is the EU Retirement Pension the position is as follows: Pensions are not normally subject to PRSI contributions. To maintain entitlement to a social insurance pension a person in this situation who has had at least three years Class S contributions paid can become a voluntary contributor subject to satisfying the normal criteria. A combination of the voluntary and compulsory insurance, provided a total of 10 years contributions have been paid, can be used to qualify the farmer for a social insurance pension at age 66.

Under the farm retirement scheme if a social insurance contributory pension is payable at age 66, the farm retirement pension will be reduced accordingly for the remainder of the period of entitlement of the EU pension.