Landmark legislation to introduce Pay-Related Benefit in Ireland passed by the Oireachtas

ashambles said:

Lenihan I believe in 2011 during the financial crisis.

At the same time PRSI was added to all sorts of non-pay related income, non Pay Related "PRSI" that in almost all cases as far as I understand provides no entitlement to Social Insurance. Also tax relief on PRSI for pension contributions removed.

A major disadvantage of implementing a negative change against middle to high earners is that it's politically nearly impossible to reverse so we end up stuck with every dumb decision for decades or effectively life times.

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Am I paying PRSI twice, on the way in to my private pension and out?

I think by removing the alignment between payments in and out undermines the principles of PRSI being a public insurance system. Ideally it would be a flat percentage up to a maximum but I can accept that it being stepped.

Your point about the political ability to make certain changes is correct. It seems even if the change can be well justified there is too much political points to be gained by the opposition by objecting to it. Is this unique to Ireland? I mean if any party would address this it would be FG but are they the least likely to be able to make this change?

You'll pay PRSI+USC in and out, until you're at whatever the cutoff ages are - currently 66.

RTE on budget day pick one change and try to make it a story they can run with for a week or two - the Liveline school of journalism.

Political parties worry they can make 99 populist changes in a budget but a single more targeted change is going to be used by media as a hammer handing an easy win to the opposition. So they can't undo the emergency PRSI moves in 2011 or any other similiar tax anomalies.

ashambles said:

You'll pay PRSI+USC in and out, until you're at whatever the cutoff ages are - currently 66.

RTE on budget day pick one change and try to make it a story they can run with for a week or two - the Liveline school of journalism.

Political parties worry they can make 99 populist changes in a budget but a single more targeted change is going to be used by media as a hammer handing an easy win to the opposition. So they can't undo the emergency PRSI moves in 2011 or any other similiar tax anomalies.

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It’s interesting how much the media can drive policy. They already have x hours set to full on the budget.

One that gets me is when tax bands move in line with inflation it’s referred to as a “giveaway”.

faketales said:

Am I paying PRSI twice, on the way in to my private pension and out?

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You don't pay Prsi out of your private pension if it is an Occupational Pension or an Annuity. Prsi Class M applies to these and is zero rated.
If you have ARF drawdowns you will pay Prsi Class S up to the time you start your State Pension or until you reach age 70. After this Prsi Class M applies to ARF drawdowns.

ashambles said:

At the same time PRSI was added to all sorts of non-pay related income, non Pay Related "PRSI" that in almost all cases as far as I understand provides no entitlement to Social Insurance.

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This is Class K. It is charged at 4% and has no benefits.
I think this was introduced by Michael Noonan.

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Pay Related Benefit will start on 31st March 2025