Dáil Éireann Debate, Tuesday - 26 May 2015
180. Deputy Michael McNamara asked the Tánaiste and Minister for Social Protection the regulations in which the manner of the application to become an insured person paying contributions, referred to as a voluntary contributor, and the period within which it must be made, are prescribed. [19959/15]
Amharc ar fhreagra181. Deputy Michael McNamara asked the Tánaiste and Minister for Social Protection the changes to the voluntary contributions system introduced since 2011. [19960/15]
Amharc ar fhreagraI propose to take Questions Nos. 180 and 181 together.
The purpose of the voluntary contribution scheme is to protect the pension entitlements of those who have already qualified for State pension, by maintaining the yearly average number of contributions which determines the rate at which the pension is paid. A person under pension age who ceases to be covered by compulsory social insurance may opt to become a voluntary contributor, provided they have at least 520 PRSI contribution weeks paid in either employment or self-employment.
The rates at which voluntary contributions are payable are based on the last PRSI contribution paid by or credited to the individual and are outlined in the following table.
|
Type of Voluntary Contribution |
Amount Payable |
Minimum Annual Payment |
If you paid PRSI at Class |
|
High Rate |
6.6% |
€500 |
A, E, H |
|
Low Rate |
2.6% |
€250 |
B, C, D |
|
Special Rate |
Flat rate of €500 |
Flat rate of €500 |
S |
The manner in which a person may apply to become a voluntary contributor and the period within which an application must be made are set out in Articles 28 to 37 of Social Welfare (Consolidated Contribution and Insurability) Regulations 1996 (SI 312 of 1996), as amended. These regulations require that:
- The application must be made within 12 months after the end of the contribution year in which the person ceased to be covered by compulsory insurance;
- A person who wishes to become a voluntary contributor must agree to pay voluntary contributions from the start of the contribution week that follows the week in which they left compulsory insurance or in the case of a self-employed person from the beginning of the year following that in which they ceased to be a self-employed contributor;
- The applicant must furnish evidence of his/her reckonable income in order to calculate the amount of the voluntary contribution to be paid.
The following changes have been made to the voluntary contribution scheme since 2011:
- In 2012, the minimum rate payable at the high rate increased from €317 to €500 and at the low rate from €126 to €250. The flat rate payable was also increased from €253 to €500.
- In 2012, measures were introduced to increase the number of qualifying contributions required to become a voluntary contributor from 260 to 520 contribution weeks which was implemented on a phased basis over 3 years between April 2012 and April 2015.
