Implications of new law on age 65 retirement

Clamball said:
My DB scheme assumes I will be entitled to the full state pension at 65 which is no longer the case, and maybe never was as I may not reach 2080 credits by my 65th birthday.
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It is very strange (and unusual) that your DB scheme would assume that you will get the full State Pension. What if an employee joined the scheme and left after 5 years and emigrated? What if someone had joined the DB scheme in their forties?
The more usual assumption in a DB scheme is that a member will get a State Pension commensurate with their length of service in the Scheme, eg, after 15 years service assume that the person will get 15/40 of the State Pension.

Jut to note also that up until 2014 there was a State Pension (Transition) payable at 65 with the State Pension (COAP) payable from 66 (as now). There were slightly different rules for the Transition Pension.
 
I think mine also assumes FULL state pension. I joined at 35 so that wasn’t happening. I must go read the booklet
 
I applied for BP65 when I reached my 65th birthday recently as I learned that my defined pension was going to be decreased as it was assumed that I would have been received the OAP at 65. The rules of the pension dictate that the pension payment is decreased.

I received a response from the Department of Social Protection asking me for further information.
See the attached form.
Is the BP65 payment means tested ?

My husband is still working and we file a self assessment return as I was previously self employed and we have rental income of €29,880 gross (2024/5)
I have an ARF and receive approximately €1,600 p.a.
My defined benefit pension is €10,560 p.a ( approximately)

I have not worked for many years.

I apologise that my figures are not 100% accurate however I am away and cannot receive notifications to my mobile so cannot sign in to Zurich or my bank to verify the numbers.

This letter from Social Protection has really freaked me out.
 

Attachments

  • Semp Questionnaire BP65.docx
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10amwalker said:
Is the BP65 payment means tested ?
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No.

Payment for people who retire at 65

If you retire at 65, you may qualify for a benefit payment until you reach 66. The payment is similar to Jobseeker’s Benefit, but you don’t need to be looking for work or sign on at your local Intreo centre.
www.citizensinformation.ie
 
Thank you Clubman.

Does that mean that I had to be working up until my 65th Birthday to receive the payment ?
I would assume that this is not the case.
 
You will not qualify for BP65 as you have rental income in excess of 7.5k.

Do you meet the Prsi qualification rules for class A employment ?

You could qualify for Jobseekers Benefit but the rental income must be classed as subsidiary income.

You would need to cease an employment which ran concurrently with your rental income for a period of at least 6 months.

If you have ceased your employment immediately before age 65, you should apply for Jobseekers Benefit.

If you have ceased before your 65th birthday you might need to procede as below.


Can a person with rental or investment income over 7500 euro per year qualify for 65s benefit ?

No. However they could qualify for Jobseekers benefit at age 65. Basically the subsidiary employment rules for Jobseekers benefit are different to those for 65s benefit. Employment 1. PAYE employment Employment 2. Rental or investment income over 7000 euro per year. To qualify...
www.askaboutmoney.com
 
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Thank you S class. Excellent information and very clearly stated as always.

I think I will not qualify as I stopped working in April 2019 and there has been annual rental income since April 2019. Therefore jobseekers benefit is a non runner too.

So the BP65 is actually means tested.
 
Thank you both, S class and ClubMan.

" Having Rental income over 7.5k is classed as being in self employment. Therefore you cannot claim that you are currently unemployed. "

Thank you, the penny has dropped now.

It is a little strange though that for 10 years prior to my 65th Birthday I received more each month than I will receive each month from March 2025 to March 2026.

The rental income was declared and the tax paid each year.
 
Yes, but it's not really the amount of your rental income that matters but the fact that it's subject to class S PRSI:

Rental income only - what PRSI class applies?

As the title says - if an indivual has no income other than rental income what PRSI class applies? Class S? Class K? K9? Other?
www.askaboutmoney.com
... whereas you need class A (or H or P) for a certain preceding period in order to qualify for the BP65. (I'm sure that @S class can explain it better/in more detail as usual).

So, because you don't meet the PRSI contribution qualification conditions, you don't qualify for the BP65.
 
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10amwalker said:
It is a little strange though that for 10 years prior to my 65th Birthday I received more each month than I will receive each month from March 2025 to March 2026.
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Presumably you are referring to your occupational pension income.

In the Public Sector pension schemes you were expected to claim any social protection payments that you were entitled to before you would be entitled to claim supplementary pension.

If a person was not entitled to claim BP 65, they would be entitled to supplementary pension from age 65 to 66.

You could tell your pension provider that you are not entitled to claim BP 65.

Ask them if you should then be entitled to supplementary pension for this year.
 
@10amwalker

I just reread the form you received from DSP.
It is asking if you have recently ceased or have fully drawn down an ARF. An ARF is also considered as self employment.

If you have a recently ceased self employment your rental income would then be classed as subsidiary income and you would then qualify for Jobseekers Benefit Self Employed up to age 66.

This is exactly the same as BP 65.

If you converted your ARF to an Annuity you would have ceased a self employment. The annuity payments are a pension and would not prevent you from qualifying for JBSE.

You could check with DSP if this is possible.
 
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Interesteing thread - there always seems to be another twist to BP65...

So, if someone leaves their job at say age 63 (from a Class A employment) and has no rental income or other employment income BUT has started to draw down an ARF THEN they will not qualify for BP65, regardless of meeting all other qualifying conditions? Is that correct?

Is the 7500 income relevent if its from an ARF?
 
Thank you both again.

I have not converted my ARF to an Annuity and it is not fully drawn down. I receive the mandatory 4% yearly.
I am in communication with the DSP and they too have been extremely helpful.
I will provide all the information they are looking for but at least now I understand that it is not a given that I will receive either the BP 65 or the Jobseekers Benefit.

However I assume that I will need the result of their assessment before I can approach my pension provider. I was not in the public service however the pension rules maybe based on the public service pension scheme rules as the company was Semi- State when I joined the pension scheme in 1982.
 
If you meet the class A rules in your governing year you will qualify regardless of the size of your ARF.

But If a PAYE worker does not meet the class A rules in their governing year, but meets the class S rules they might be able to qualify if they cease their ARF.

I started a new thread on this subject.

Can a retired PAYE worker use class S contributions to qualify for Benefit Payment 65.

The following is based on my reading of the rules of BP65SE, so it may or may not be possible. If a PAYE worker has taken early retirement and has ARF drawdowns over 5k per year they will get 52 class S contributions per year. If this person has 52 class S contributions in the governing year...
www.askaboutmoney.com
 
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My head's full of cobwebs today about the "governing year" thing.
My situation is I worked 5 months part time paying PRSI aged 63 in 2024.

End of 2024, I decided not to go on working because of worsening arthritis and needed to do more partner-care.
So I recently consolidated about 80% of my pensions into an ARF which is now paying me not a huge amount but something. Won't be more than 7500 in a year.

I can't quite figure what I can or cannot do now about Jobseekers. Is there any point in going and talking to social welfare now (1 year and 9 months to pension), or do I need to wait until I'm 65 in early 2026 (1 year until pension)? I have other assets that mean I won't qualify for means tested benefits (because it's based on household income not individual).

Or is it quack quack, nope, you don't qualify...
 
I don't have any more earned but I have signed that thing where you can pay to completed your PRSI credit record the following year. So I'd be expecting to bug them about now to ask how much do I need to pay to complete my 2024 record?
 
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