Voluntary contributions in another EU state

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Forumuser

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A friend of mine has a special problem.

He was self employed outside of the EU for many years- but did not pay into any state pension system. There is one exception: He paid into the German state pension system for three and a bit years while working there. He came home some time ago and started working in Ireland for a while- but has not paid in the minimum of 10 years PRSI contributions to qualify for a part contributory pension. He became sick and is on illness benefit, getting PRSI credits every week. He has not much time left to his pension day.
He thinks now of paying voluntarily into the German system to reach the required number of 10 years for an Irish EU pro rata pension. The Germans have no problems taking his money.
Question: In paying voluntarily into another EU system he will have an overlapping of Irish PRSI credits and German voluntary contributions. The PRSI sickness credits and the voluntary German contributions would be in the same time window. Regulations say that Irish credits would displace the voluntary contributions in a pro rata calculation of his future payments. Does that mean that a payment of voluntary contributions in Germany would be a waste of money- or do they count for a fulfillment of the 10 year rule- but will be ignored later in the pro rata calculation?
 
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Forumuser said:
He thinks now of paying voluntarily into the German system to reach the required number of 10 years for an Irish EU pro rata pension.
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Will the Germans take backdated contributions?

How old is he exactly?

Where outside the EU did he work? There are social security arrangements for some non EU member states like the US that allow for mutual recognition.

Does he have any private pension income already? This could incur Class D PRSI and get him toward 520.

Sorry for all the questions but there may be a few ways to crack a nut.
 
Dr Strangelove said:
Will the Germans take backdated contributions?

How old is he exactly?

Where outside the EU did he work? There are social security arrangements for some non EU member states like the US that allow for mutual recognition.

Does he have any private pension income already? This could incur Class D PRSI and get him toward 520.

Sorry for all the questions but there may be a few ways to crack a nut.
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Thanks for the answer.
The Germans won't backdate contributions in this case. Our man can still pay in for the full year of 2023 until the 31st of March, 2024. Once that date has passed, the option is gone for 2023.All other years in the past cannot be filled with backdated contributions. That gives him roughly 11 weeks to make a decision.
Our man just got 64.
Our man was always on his own, in sometimes quite obscure places, under questionable conditions. Most of the time just to survive. There isn't a hope in hell he would qualify for any social security arrangements with the EU and other places. That option is out for sure.
No private income pension either- but he might get some inheritance down the road.

With just two full year contributions in Germany he would be over the 5 year limit in Germany and over the 520 contributions limit in Ireland if all contributions from both countries are added up under EU rule. That way he would qualify for a pro rata pension from both countries. There is the question of the validity of the voluntary contributions
The snag is the overlapping of the German voluntary contributions with the Irish IB credits. As far as I know the Irish credits will count for the calculation of the Irish portion. What I am not sure of is if the voluntary contributions would still count for the sole fulfillment of the Irish 520 contributions rule even if they do not count for a pro rata calculation deciding on the weight between the Irish and the German part pensions.
 
Forumuser said:
Our man was always on his own, in sometimes quite obscure places, under questionable conditions.
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It’s hard to believe he has no social security presence over 45 years of adult life except three years in Germany and a few in Ireland. He should do his homework on this as there may be options. If he’s ever worked at least 12 months in the UK for example he could make contributions there.

As for the bigger question it’s beyond my knowledge but I hope one of the many expert contributors can help.
 
Sarenco said:
Would he qualify for a non-contributory State pension?
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Yes- he would.
But there is an inheritance waiting down the road- and that would probably take away a lot of the NC pension money. It won't happen tomorrow- but the clock is ticking.
 
Dr Strangelove said:
It’s hard to believe he has no social security presence over 45 years of adult life except three years in Germany and a few in Ireland. He should do his homework on this as there may be options. If he’s ever worked at least 12 months in the UK for example he could make contributions there.

As for the bigger question it’s beyond my knowledge but I hope one of the many expert contributors can help.
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Our man has been living a life which was completely different from yours or mine. Let us call him an adventurer. No use lecturing him- he is who he is. And he is getting old now.
That is why I try to find out things for him.

Your possibility with the UK contribution is an interesting one. No-he never worked there. But let's just stay with it for a minute or so. You proposal with the UK contributions is just the same as with the German contributions- only the country is different. But we would still end up with an overlapping in case of a pro rata pension. Is the problem with the overlapping handled any different between the UK and Ireland than between Ireland and Germany? Same question as above applies here...
 
S class said:
He could pay voluntary Prsi backdated for up to 4 years and in the future up to age 70.
He might be able to reach the 520 level.
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You cannot make any voluntary contributions in Ireland until you have paid 520 IRISH contributions. Our man does not have those 520 paid PRSI contributions.
Work is out of the question- he is too sick. He won't get well either...never mind making it workwise to 70 years.
 
Forumuser said:
You proposal with the UK contributions is just the same as with the German contributions
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No it’s not. You can theoretically get a full UK state pension on its own with enough backdated contributions.


It’s best if you share as much as you know about your friend’s social security record wherever he lived rather than vague anecdotes.

There may be other ways to maximise his retirement income than voluntary German contributions.

Good luck, I’m out.
 
He could get a paid class A Prsi contribution if he has earnings of at least 38 euro per week. 3 hours minimum pay per week.

Could he get a friend to employ him for light duties for 3 hours per week ?
 
S class said:
He could get a paid class A Prsi contribution if he has earnings of at least 38 euro per week. 3 hours minimum pay per week.

Could he get a friend to employ him for light duties for 3 hours per week ?
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A bit difficult when you are on IB because you are sick. I can never see him working again.
 
After a quick bit og googling I found the following information from Germany in English:
Paying voluntary contributions in Germany
If you pay voluntary contributions, you may increase your German pension, get
a pension in the first place, or close gaps in your insurance record.
If you reside in Germany and are not liable to pay social security contributions in Germany, you
may pay voluntary contributions to the Deutsche Rentenversicherung scheme. The only
requirement is that you are 16 years old or older. Your nationality is of no relevance.
Note: You will find more information in our leaflet ‘Freiwillig rentenversichert: Ihre Vorteile.’
If you are German, you may pay voluntary contributions to the German scheme independent of
your country of residence.
As a rule, non-Germans are not entitled to pay voluntary contributions outside Germany.
However, they may, for example, pay voluntary contributions if European Community law or a
social security agreement provides corresponding provisions.
Citizens of countries which are neither covered by European Community law nor by a social
security agreement may only pay voluntary contributions if they live in Germany. This is not
possible from abroad.
Note: Please also read the leaflet ‘Living and working in Europe’ and the respective leaflets about
the social security agreements.
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My bold. There seems to be some leeway there for EU citizens to make voluntary contributions in certain circumstances. My gut instinct says the Germans would treat you the same as if you had returned to Germany after working in a non-contracting state, if you had any contributions in the German system. The DSP treated me as if I had been living in Ireland when I applied to pay voluntary PRSI even though I had left Ireland 13 years earlier. They treated my employed time in Germany as if I had been employed in Ireland. Have you clarified the position in writing with the Deutsche Rentenversicherung?

www.deutsche-rentenversicherung.de

Working in Germany and in non-contracting states

Englische Ausgabe
www.deutsche-rentenversicherung.de www.deutsche-rentenversicherung.de

(Click Herunterladen to download the pdf)
 
murphaph1 said:
After a quick bit og googling I found the following information from Germany in English:

My bold. There seems to be some leeway there for EU citizens to make voluntary contributions in certain circumstances. My gut instinct says the Germans would treat you the same as if you had returned to Germany after working in a non-contracting state, if you had any contributions in the German system. The DSP treated me as if I had been living in Ireland when I applied to pay voluntary PRSI even though I had left Ireland 13 years earlier. They treated my employed time in Germany as if I had been employed in Ireland. Have you clarified the position in writing with the Deutsche Rentenversicherung?

www.deutsche-rentenversicherung.de

Working in Germany and in non-contracting states

Englische Ausgabe
www.deutsche-rentenversicherung.de www.deutsche-rentenversicherung.de

(Click Herunterladen to download the pdf)
Click to expand...
German national.
 
He's in a stronger position as a German citizen to make voluntary payments to cover gaps in his record in Germany or at the very least to make voluntary payments going forward.
 
Dr Strangelove said:
Really?

I didn’t think you could discriminate by nationality when it comes to social security within the EU.
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Reading the line above the line I bolded in the quote I posted certainly suggests that German citizens have more freedom to make voluntary contributions in Germany regardless of where they live. It may be true that an EU citizen would have legally just as much of a right (that's the slightly vague bold bit I posted) but for Germans it should be easier. For example if an Irish citizen never worked in Germany they have no right to make voluntary contributions there. German citizens may make voluntary contributions even if they never worked in Germany even if they don't live in Germany it seems. Certainly if Ireland is refusing to allow voluntary contributions because he is below the 10 years of earned contributions.

How many years has he in total between Ireland and Germany? Does he have the 5 years that Germany requires before any pension is paid?
 
Sorry I just re-read the initial couple of posts and see he has 2 years in Germany.

Is it possible to get to the Irish 520 contributions through IB credits if he defers his COAP until he is 70 as will be allowed under the new rules?Maybe @S class would know that?

If that were somehow possible then I would advise paying into the German system until he has reached the 5 years required there and then apply for both pensions directly with the authorities in each country. The Germans will have no problem paying theirs but Ireland doesn't allow you to be "double insured" in the EU so applying directly for the pensions without invoking EU rules to combine pensions may be a better bet, but only if he can reach the 520 contributions in Ireland without using his German ones, assuming he can defer the COAP. The thing is, maybe you can't defer if you are on IB? Maybe they force you off IB and onto whatever pension you qualify for at 66? Be it COAP or NCOAP Anyone know how that works?

One more question....did he have any children? Child-rearing time will be credited in both systems to some extent.

The minimum voluntary payment in Germany is €96.72 per month. If he has the means it would be worth paying them for 3 years to get the 5 years required to be eleigible for a German pension, even if it's a bit of a gamble IMO.

I think this one is going to end up with him receiving a non-contributory pension in Ireland to be honest and he will be doing faaar better in Ireland on that than he would in Germany. Even if he managed to scrape up the 520 paid contributions his contributory pension would surely fall well below the "full" non-contributory one and he'd need some part of a non-contributory pension anyway, which would then be means tested in any case? It's kind of hard to believe that someone went almost their entire working life without making any real provision for their retirement but I guess it happens.
 
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