Class S contributions. No Pension. Any come-back?

Thank you all for your contributions. I've been in touch with the accountant and I was indeed down for the absolutely minimum wage, where I had no PRSI liability. However, PRSI was paid on my behalf, and when I made an application for the pension, I was told that I may be considered for a refund! After much to-ing and fro-ing, they refunded me "the contributions paid in error". Does this now mean that I'm not entitled to a pension?
 
If I hadn't got a refund and insisted they they acknowledge my contributions, I wonder if I would have qualified? This option was never put to me and I feel that they refunded me to get rid of me!
 
You say you had no PRSi liability but paid it. Presumably, a refund was based on this and the fact that you would never qualify for a contributory pension. I note you say accountant 'had you down to the muinimum'...
 
Th wage which I was down for was below the level where PRSI was incurred. Even though the Welfare continued to accept it, they never showed it on my History.
 
I have read that a woman can claim contributions for the years spent raising children. If this is true then it may help you.
 
Hi Clickety Click

If you were not liable for PRSI, Social Welfare were correct in regarding any PRSI contributions you paid as not valid. Indeed, they would be in breach of their own code if they did anything else.

I note you say your accountant had you down for "the absolutely minimum wage". What does this mean? Are you saying that he/she understated your income in each of the years concerned?

What was your income in each of those years? If there is any hope of progressing this matter, this kind of detail would be required.
 
could it be that you do not have the required minimum paid contributions at FULL rate PRSI, other than the class S? See this (I.ve bolded the relevant words):

"Number of paid contributions

If you reached pension age before April 6 2002, you must have 156 qualifying paid contributions (a total of 3 years but they do not have to be consecutive). This means that you must have actually paid full-rate contributions (that is, full stamp prior to 1979 and Class A,E,F,G,H,N and S since then.)
If you reach pension age on or after 6th April 2002, you will need to have 260 paid contributions (effectively 5 years contributions but they need not be consecutive). However, if you were a voluntary contributor on or before April 6 1997, you need only have 156 paid contributions if you have a yearly average of at least 20 contributions.
If you reach pension age on or after April 6 2012, you will need to have 520 paid contributions (10 years paid contributions). In this case, not more than 260 of the 520 contributions may be voluntary contributions. However, if you were a voluntary contributor on or before April 6 1997 and you have a yearly average of 10 contributions, you may meet the requirement if you have a total of 520 contributions, but only 156 need to be compulsory paid contributions."

Welfarite could you clarify:- If you reach pension age on or after April 6 2012, you will need to have 520 paid contributions (10 years paid contributions). In this case, not more than 260 of the 520 contributions may be voluntary contributions.
You say 520 contributions Can these be class S? Are class S considered voluntary contributions? or does it have to be at another class?
Would be grateful if you could clarify this as this is very worrying.
 
class S are not considered as voluntary contributiosn, They are complulosry. Voluntary contributions can only be paid if you have 260 compulsory contributions paid already.
 
Could someone answer the following ? (Note : I have 8.5 years PAYE stamps and 5 years S class)

1. I'm self-employed but haven't worked in 8 months. I've been paying myself a salary from the money in the company since but as I'm nearly down to about 5K in the account, I'm going to stop paying myself from the company and switch to living off what savings I have, so that I can at least continue to pay whatever bills come into the company.

So will that make me unemployed ?

2. As my wife is still working and earning a decent wage, and because I've been paying Class S stamps over the last 5 years, I expect I will get nothing, monetarily, from the JB/JA.

Is there a point me signing on ? IIRC, a PAYEr can at least get their stamps paid by signing on even they don't qualify after a means test. Would I get my S class stamps paid ?

3. When I set up my company initially, could I have opted to pay the full stamp and thus have made a difference if unemployed ? Perhaps I can switch when I next (please god, soon) work ?
 
Thank you all for your contributions. I've been in touch with the accountant and I was indeed down for the absolutely minimum wage, where I had no PRSI liability. However, PRSI was paid on my behalf, and when I made an application for the pension, I was told that I may be considered for a refund! After much to-ing and fro-ing, they refunded me "the contributions paid in error". Does this now mean that I'm not entitled to a pension?

If what your accountant did is the case, the you should have paid PRSI at the A rate as it would appear that you were employees of your business rather than proprietors. Proprietors usually pay at Class S . It may well have been that what you accountant was trying to do was minimize your tax liability. There are swings and roundabouts in the accountancy game and what you may have gained in the tax side, you have lost on the PRSI side.
 
Could someone answer the following ? (Note : I have 8.5 years PAYE stamps and 5 years S class)

1. I'm self-employed but haven't worked in 8 months. I've been paying myself a salary from the money in the company since but as I'm nearly down to about 5K in the account, I'm going to stop paying myself from the company and switch to living off what savings I have, so that I can at least continue to pay whatever bills come into the company.

So will that make me unemployed ?

2. As my wife is still working and earning a decent wage, and because I've been paying Class S stamps over the last 5 years, I expect I will get nothing, monetarily, from the JB/JA.

Is there a point me signing on ? IIRC, a PAYEr can at least get their stamps paid by signing on even they don't qualify after a means test. Would I get my S class stamps paid ?

3. When I set up my company initially, could I have opted to pay the full stamp and thus have made a difference if unemployed ? Perhaps I can switch when I next (please god, soon) work ?

Was in similar situation myself, self employed with ltd. company.
They will means test you for job seekers and take your wifes earnings into account and any savings you have, so you might not get much, if anything.

You would have to make voluntary social ins. payments your self.

You can only pay class A stamp if you are not majority shareholder in the company, i.e. if someone else controls the company, in effect you are an employee. You can set it up this way, by making someone else in control.
The scope section of social welfare deal with this and may take some time. I thought I might be better off on class A, but as class A is a higher payment they also backdate it, so ecided to stick with class S. just make sure all your class S contributions are fully up to date. (Class S you still get full contributory pension.) 2 years of paying class A would qualify you for dole. Its a minefield.

Also when assesing you for job seekers, they only take into account 2 years of your contributions, know someone unemployed, worked since he was 14, but didn't take that into consideration, since he was self employed for last 5 years paying class s. Its a minefield.
 
Was in similar situation myself, self employed with ltd. company.
They will means test you for job seekers and take your wifes earnings into account and any savings you have, so you might not get much, if anything.

You would have to make voluntary social ins. payments your self.

You can only pay class A stamp if you are not majority shareholder in the company, i.e. if someone else controls the company, in effect you are an employee. You can set it up this way, by making someone else in control.
The scope section of social welfare deal with this and may take some time. I thought I might be better off on class A, but as class A is a higher payment they also backdate it, so ecided to stick with class S. just make sure all your class S contributions are fully up to date. (Class S you still get full contributory pension.) 2 years of paying class A would qualify you for dole. Its a minefield.

It's only a minefield when you try and bend the rules. The bottom line is that you are liable for Class A when an employee(i.e. can be directed in your work, can be sacked) or Class S (director/self-employed). Scope Scetion decide this, not you or your accountant.

Also when assesing you for job seekers, they only take into account 2 years of your contributions, know someone unemployed, worked since he was 14, but didn't take that into consideration, since he was self employed for last 5 years paying class s. Its a minefield

This doesa not make sense. No contributions are taken into consideration for assessing means on a Jobseeker's Allowance claim. If you are self-employed , they assess previous income to project what you may earn going forward. And PRSI is not payable until one is 16 years of age. Age 14 is inusrable for SW purposes
 
I never suggested bending the rules. But if you have a limited company and it is controlled by someones else with the majority of shares, then as an employee you can pay class A. The final decision of course rests with SCOPE.

My friend who was made recently unemployed only qualified for job seekers
assistance and not the full dole, despite paying class A from age 14 up to 5 years ago, he then became self employed and was told they only take the
most recent contribution 2 years or less, he was on class S for 5 years, before that class A. Why would I make this up? It is a minefield if you claim the above is untrue.
 
Why would I make this up? It is a minefield if you claim the above is untrue.


I never said you made it up or that is was untrue; I said it did not make sense. But I understand it now from your last post. Firstly, as already said, the age you start paying PRSI is 16 not 14. And Jobseeker's BENEFIT is based on cons. paid in the governing year (For claims in 2009, this is 2007, two years ago). Jobseeker's Allowance( Assistance as you call it) is a means tested payment and is payable any contributions being paid.
 
O.k. thanks, is it a recent thing that they only take 1 years contributions into consideration for social welfare purposes. I would have thought they would take an accumulated amount over a lifetime, seems unfair?
 
O.k. thanks, is it a recent thing that they only take 1 years contributions into consideration for social welfare purposes. I would have thought they would take an accumulated amount over a lifetime, seems unfair?


It has always been the case that they looked at agoverning year for the second qualifying condition (39 paid or credited basically, years ago it used to be only 26 in the GCY!). The first condition of having 104 contributions paid (rather than 52) is as recent as the first 2009 budget.
 
Thanks for your help. It sounds like there isn't much point in signing on. Today is my last day of paying myself wage from the company funds, so will have to start hitting my savings as of next week.
 
Thanks for your help. It sounds like there isn't much point in signing on. Today is my last day of paying myself wage from the company funds, so will have to start hitting my savings as of next week.


Before you decide, it might be best to call to your local SW office and talk to the Information Officer there; or call to Citizen's Information Centre. Best to be sure before you make a decision that might have huge effects on pensions and the like down the line!
 
Thank to everybody for remarks, advice etc. My earnings were under 2500 per annum, I paid PRSI for the ten years, and eventually I was refunded. Have I any redress at all?
Are there any grounds on which I could appeal?
 
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