Implications for State Pension entitlement if receiving COVID-19 payment

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Homer

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I figured I should be able to find rather answer to this easily, but couldn’t find it on any of the usual websites.

If someone is receiving the COVID-19 payment, will they have credited contributions allocated towards their entitlement to State Pension while in receipt of the payment? I expect they will, but I’ve been asked by a friend who wants to be 100% certain.
 
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If you are an A or S class contributor and in receipt of Jobseekers Benefit, then you get credits added to your record. I haven’t seen anything similar in relation to COVID-19 payment, but I expect it will be treated the same as JB.
 
Thanks Conan. I would expect so too, but I can’t find anything explicit to confirm this.

I tried calling the DEASP today on the number listed online, but got a recorded message saying the number is no longer valid and directing me to call a1890 number. I’d prefer not to get ripped off calling one of those numbers, but will do so if unable to get a definitive answer elsewhere.
 
Homer said:
Thanks Conan. I would expect so too, but I can’t find anything explicit to confirm this.

I tried calling the DEASP today on the number listed online, but got a recorded message saying the number is no longer valid and directing me to call a1890 number. I’d prefer not to get ripped off calling one of those numbers, but will do so if unable to get a definitive answer elsewhere.
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1890 numbers now cost no more than a local call and are included in minute bundles from all operators.

Nothing definite but Irish Time seems to have got confirmation that they will

www.irishtimes.com

Will pandemic payment give me PRSI stamp as retirement looms?

Q&A: Dominic Coyle
www.irishtimes.com www.irishtimes.com
 
Thanks Sunny. That article is very helpful and explains why I have been able to find anything definitive online.

Thanks also for that update about 1890 numbers. It has long been a bugbear of mine and I wasn’t aware of the change.
 
As far as I know nothing has been confirmed yet, and the article posted above gives about as much information as I have seen. It seems the least that they will award is a credit, and the information even suggests that people will not be prejudiced.

However, there is a discrepancy in the information being published. For some people, getting a credit while on the PUP will not prejudice them, particularly if they have 10 years paid contributions already. However, for others there are possible implications, both for State Pension entitlements and more likely short term benefits such as Jobseekers, Illness and Maternity Benefit over the coming years, as these payments require a certain number of paid contributions in certain years.

But for anyone particularly worried about their State Pension, as long as you have 10 years working history within the State, a credit is just as valuable as a paid contribution.
 
They also have to consider the position of self-employed people. You can't usually get a credit if you only have self-employed contributions in the last two years. This will only be a problem for those whose income has dropped to below the 5k threshold where you start to pay PRSI, but for anyone under that threshold, they would need to consider whether they might want to pay a voluntary contribution.

Some clarity from the Department would be very useful.
 
lughildanach said:
They also have to consider the position of self-employed people. You can't usually get a credit if you only have self-employed contributions in the last two years.
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Hi Lughildanach, can you clarify what you mean by this - is it that if you've been self-employed and paying class S PRSI up until the current situation you are not entitled to credited contributions?
 
ATC110 said:
Hi Lughildanach, can you clarify what you mean by this - is it that if you've been self-employed and paying class S PRSI up until the current situation you are not entitled to credited contributions?
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To get credited contributions you must have been paying or receiving a contribution at Class A, B, C, D, E or H within the past two complete tax years. Class S does not count, so those who have only had self-employed income over the past two complete tax years cannot receive a credited PRSI contribution. They can however arrange to pay a voluntary contribution.

Credited social insurance contributions

A credited social insurance contribution is a contribution given to you and recorded on your social insurance record. This page explains the rules on credited contributions for students, carers, homemakers, voluntary development workers and people who retire early.
www.citizensinformation.ie www.citizensinformation.ie
 
The absence of credits for the self-employed is one of the lesser known issues around PRSI records that really can devastate pension entitlement, often without the person knowing anything about it, or being advised by the relevant authorities of the appropriate action.

Luckily you can arrange to make voluntary contributions up to five years after the year you last had paid insurance, but not everybody is eligible to make voluntary contributions (eg. you need to have 10 years paid contributions already), and some only find out that there is a problem more than 5 years after the event. Anyone affected who got bad advice or no advice from social welfare at the relevant time could complain and ask for the voluntary contributions to be backdated further.

Voluntary social insurance contributions

Voluntary social insurance contributions can help you qualify for a social insurance payment in the future. Find out more about making voluntary contributions.
www.citizensinformation.ie www.citizensinformation.ie
 
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I should make clear though that anyone whose profit is above 5,000 euro for the year will not be affected by this credits issue, as they will still pay their PRSI. They will have a paid contribution and therefore don't need a credit. Credits or voluntary contributions are only needed when someone isn't paying PRSI.
 
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