Joined Voluntary Contribution Scheme then becoming self-employed

S

sadie

Registered User
Messages
679
Last year I was accepted into the Voluntary Contribution scheme in order to fill in PRSI gaps relating to the Contributory Pension.
I agreed to back pay the previous 5 years at €500 for each year.
What happens now going forward if I become self-employed, and for example I earn around 10k a year going forward.
I think the situation is that I keep paying the €500 annually each year up to age 65/66, because I need to maintain the Class A contributions, not the Class S self-employed contribution?
Have I got that right?
 
With self employment earnings of a minimum of 5000 euro you will pay 500 euro Prsi.
This will be Class S. You will not be allowed to make voluntary contributions if you are gaining 52 S contributions. The voluntary contributions based on class A are not actually A contributions. Their only benefit is qualification for the contributory pension.
The class S contributions are better as they allow for other benefits e.g. treatment benefit. If you don't become self employed it would be a good idea to work for one week and gain a class A contribution. Then sign on for A credits. This will allow you to regain treatment benefits. It is allowable to make voluntary contributions and get class A credits in any year. It is also possible to get class A credits and class S in any year.
So it would be a good idea to sign on for A credits alongside occasional self employment.
Also if you currently have at least 520 paid contributions (A or voluntary) you would get the same contributory pension qualification benefit from A credits as from voluntary contributions. This would save you 500 euro per year.
 
You must log in or register to reply here.
Back
Top