# My dad can't get a State OAP pension because of ill advice from accountant



## moneymattors (26 Oct 2010)

Need advice please

My dad employed the same accountant since 1998 when he began working as self employed.  Hitherto his work had been seasonal and he was not eligible to pay tax. 

When he retired last year he found he was not eligible for a contributory pension. It turned out his profits did not exceed the threshold for PRSI payments and he had not been advised by his accountant to apply for voluntary payment eligibility.    My dad had taken it for granted that he was paying PRSI for each tax year and did not question the accountant.  

He  is now gutted. Unfortunately he is not eligible for non contributory pension either since my mum is employed as a public sector worker.

After working all his life is he now faced with life with any form of a pension.? He has   a total of 174 full rate paid contributions ie a yearly average of 5 contributions  when the average demanded is 10.  Is there anyone out there  who can advise him or guide him on positive steps to follow?  He refuses to have to rely on us to “keep” him for the remainder of his life.  

My mum is ready to retire and it seems that the pair of them will now be forced  to “Split” her pension  for survival after the two of them working hard and keeping to the rule books with regard to revenue all of their lives! 


There was malpractice and I feel the accountant was at fault.  Dad  belongs to the generation where you don't go around suing your  friends and I feel that option is pretty much off the cards. Besides, he now questions whether  his appointed accountant was ever really qualified in the first place!

My questions are:

a: How do you find out if he was qualified? Is there a list of all accountants on line or something? His name does not appear on "Chartered accountants Ireland 'search but that might be something different. It would be a good starting point.


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## Brendan Burgess (26 Oct 2010)

Hi



> he had not been advised by his accountant to apply for voluntary payment eligibility.


To be quite honest, I am not sure that advising on Social Welfare eligibility falls withing the scope of  a person's accountant. 

I would be very impressed if an accountant advised someone to take some action such as you are suggesting to qualify for a pension.

I don't think that the qualification of the accountant is relevant here. If he is qualified, it will be on his headed notepaper.



> He has   a total of 174 full rate paid contributions



That is only 3 years of full rate contributions.  Are you sure that paying something voluntarily for 12 years should make him eligible for a state pension? 

The Social Welfare system is full of crazy anomalies, but I hope that someone with 3 years' PRSI would not be able to qualify for a pension by signing up for a minimum payment for a further 12 years.


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## Ravima (26 Oct 2010)

not eligible to pay tax, or working in the black economy?


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## Marietta (26 Oct 2010)

moneymattors said:


> My mum is ready to retire and it seems that the pair of them will now be forced to “Split” her pension for survival after the two of them working hard and keeping to the rule books with regard to revenue all of their lives!


 
I think your mother would be able to claim half rate contributory pension for your father and if things are really in dire straits he may be eligible to claim the non contributory pension, however, it will be means tested.


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## diem (26 Oct 2010)

While very sorry for your dad's situation, it would appear from your post that he really is not any worse off than during his working life as he never earned enough to pay PRSI contributions.


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## babygirl (27 Oct 2010)

moneymattors said:


> Need advice please
> 
> My dad employed the same accountant since 1998 when he began working as self employed. Hitherto his work had been seasonal and he was not eligible to pay tax. When he retired last year he found he was not eligible for a contributory pension. It turned out his profits did not exceed the threshold for PRSI payments and he had not been advised by his accountant to apply for voluntary payment eligibility. My dad had taken it for granted that he was paying PRSI for each tax year and did not question the accountant. He is now gutted. Unfortunately he is not eligible for non contributory pension either since my mum is employed as a public sector worker. After working all his life is he now faced with life with any form of a pension.? He has a total of 174 full rate paid contributions ie a yearly average of 5 contributions when the average demanded is 10. Is there anyone out there who can advise him or guide him on positive steps to follow? He refuses to have to rely on us to “keep” him for the remainder of his life. My mum is ready to retire and it seems that the pair of them will now be forced to “Split” her pension for survival after the two of them working hard and keeping to the rule books with regard to revenue all of their lives!
> 
> ...


 

did your father actually ask his accountant if he was paying PRSI? if he didnt then i dont see how you think the accountant is at fault
your father wasnt aware of the rules for paying PRSI so i dont understand how you can say that he followed the rules all his life with regards to revenue and getting a pension....
did he make any provisions for his retirement throughout his working life eg. savings/investments?
its a terrible situation for your father to be in but the blame dose not lie with the accountant.


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## shinners (25 Nov 2010)

Your dad is not entltled to a contributory pension due to insufficient PRSi contributions however he may be entitled to the non contributory state pension http://www.welfare.ie/EN/Schemes/Pension/SPNonContributory/Pages/oancp.aspx

it will depend on his circumstances. I would advise looking into it.

In our title you said not entiled to pension to to ill advice, i believe this issue is really lack of advice. Did your dad have a letter of engagement with his accountant detailing what returns/advice etc the accountant is responsible for/would give? Didi he ever ask about prsi contributions? 

Socal welfare advice is not covered in most letters of engagement. The voluntary PRSi contribution system is not part of the Revenues remit and therefore usually out of scope of accoutants. However clients in these tough are begining to asking questions regarding sopcial welfare entitlements and expect accountants to be experts in it, which they are not. 


I have advised clients to apply for the voluntary prsi contribution scheme a number of times.

If accountant not listed as Chartered try looking up CPA or ACCA sites.

Good luck with applying for non contributory pension.


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## user name (25 Nov 2010)

Maybe the accountant advised your dad about the voluntary contributions 12 years ago and he did not go with it as he was only earning €60 or so per week and thought that paying the voluntary contribution of €253 was too expensive at the time, especially if he had a young family. €253 was a months wages for him.
I dont know how he would have thought he was paying prsi if his tax bill was nil every year.
If your mother gets the qualified adult allowance for him surely this will be more than what he was earning when he was working.


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## gipimann (25 Nov 2010)

Depending on the type of public sector employment, the OP's mother may only qualify for a public sector pension (rather than a state pension) and there may not be an increase for a qualified adult on that pension.  As an example, HSE employee pensions are based on salary and years of service, not whether the retiree is married or single.

OP, although your father does not have an entitlement to non-contributory state pension now, that may change depending on the amount of pension payable to your mother (as well as other income, savings, etc in the household).   So it would be worth his while applying again when circumstances change.


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## Bronte (26 Nov 2010)

moneymattors said:


> My dad employed the same accountant since 1998 when he began working as self employed. Hitherto his work had been seasonal and he was not eligible to pay tax.
> 
> .


 
What you are basically saying is that your dad during the last 45 years has not paid prsi,  and in those 45 years he's been self employed for 12 years.  How could he expect a contributory pension based on basically no contribution?


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## Black Sheep (27 Nov 2010)

In order to receive a Contributory pension you have to contribute, that is for all or most of your working life.

If he went self-employed in 1998 was he employed before that?. 
Do you have the full records of PRSI from SW?
Did he ever work in the UK or abroad ?
As soon as your mum retires he should re-apply for non-contributory pension. He may be entitled to a part-pension based on the reduced income. This would also mean that he *may* be entitled to the Household Benefits Package and fuel allowance.
Up coming Budget could change all of the above


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