When will I get the State Pension?
This is one of the most common questions I’m asked. Hardly a week goes by without one of my clients contacting me looking for assistance in this area. It can be a bit of a maze, so it can make sense to have an adviser help you navigate your way. I’ve outlined the main details below. You can click on some of the handy links, which are provided by State bodies, to get even more information.
State Pension (Contributory)
The State Pension (Contributory) is paid to people from the age of 66, who have enough Irish social insurance contributions. The Contributory Pension is not means-tested. You can have other income and still get a State Pension (Contributory). However, this pension is taxable but you are unlikely to pay tax if it is your only income.
Changes to the State Pension (Contributory)
The Social Welfare and Pensions Act 2011 made a number of changes to the age at which you now qualify for State pensions.
The qualifying age will rise to 67 in 2021 and 68 in 2028. So, what does that mean for you?
- If you were born on or after 1 January 1955 the minimum qualifying State pension age (i.e. the age at which you will now qualify for pension) will be 67.
- If you were born on or after 1 January 1961 the minimum qualifying State pension age will be 68.
|State Pension (Contributory) rates from 30 March 2018|
|Yearly average PRSI contributions||Personal rate per week, €||Increase for a qualified adult* (under 66), €||Increase for a qualified adult* (over 66), €|
|48 or over||243.30||162.10||218.00|
*Increases for qualified adults are means-tested payments (see ‘Adult dependents’ below).
What’s the Contributory State Pension and how do I qualify?
Again, this is a common question I am asked. So, to qualify for a State Pension (Contributory), you must be aged 66 or over and have made enough Class A, E, F, G, H, N or S social insurance contributions.
So what does that mean? Well, you will need to have met the criteria below;
- Have paid social insurance contributions before a certain age
- Have a certain number of social insurance contributions paid and
- Have a certain average number over the years since you first started to pay
To find out whether you do meet these criteria, you can click on the handy link below from Welfare.ie, where you will find a comprehensive Questions & Answers page.
People who applied for the State Pension (Contributory) after 1 September 2012 and whose pensions were reduced (because of contribution gaps for homemaking and caring) will be reassessed under a new Total Contributions Approach and can avail of a new Home Caring Credit. They can apply to be reassessed from quarter 4 2018 and if this results in higher payments they will be paid from early 2019 and backdated to 30 March 2018.
The new Total Contributions Approach (TCA) means that a person’s total social insurance contributions paid, rather than when they were paid, are taken into account when assessing their entitlement to a pension. The TCA calculation will include a new Home Caring Credit which will provide credited contributions for up to 20 years of homemaking and caring duties. The changes will benefit people who spent time outside the paid workplace, raising families or in caring roles.
What happens if I don’t qualify for the State Pension (Contributory)?
People who haven’t made the requisite Social Insurance Contributions, and are aged 66 or over, may qualify for the State Pension (Non-Contributory). You must be habitually resident in the State and have a valid PPS number. The pension is also “means tested”.
It’s worth getting professional advice when it comes to something as important as your pensions & retirement plans, so if you like some advice, get in contact with Con Friel & Company on 074 9121301, by email firstname.lastname@example.org or by contact form.
For further details on this pension and how the “means test” is applied, you can again click the link below to this useful site on Welfare.ie.