If you are exempt from PRSI as a pensioner you must tick a box on Form 11

Brendan Burgess

Brendan Burgess

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Just completed my Form 11 and they charged me PRSI on my income.

I was over 66 last year so I am exempt.

I discovered that although the Form 11 is prepopulated with my OAP, I must tick a box to claim it.

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You are not exempt from PRSI because you receive a pension - you are exempt because of your age
 
jpd said:
You are not exempt from PRSI because you receive a pension - you are exempt because of your age
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I don't think that that's quite correct.

Pay Related Social Insurance (PRSI) and Universal Social Charge (USC)

This section explains Pay Related Social Insurance (PRSI) and Universal Social Charge (USC)
www.revenue.ie www.revenue.ie
You will continue to be liable for PRSI until you:
  • are awarded the State Pension (Contributory)
  • or
  • reach age 70.
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If @Brendan Burgess is 66+ and in receipt of the OACP then he's exempt. (I'm pretty sure that he's not over 70 so that's irrelevant here).

I presume that this means the state Old Age Contributory Pension.
Brendan Burgess said:
Form 11 is prepopulated with my OAP
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I found the rules so hard to understand that I turned to AI for a summary, which I think is correct.


Important PRSI Exemption Rules for Pensioners
Keep in mind how Ireland's age rules apply to self-assessment income (like rental or trading income): [1]

If you were born before January 1, 1958 (Aged 66+ by Jan 2024): You are completely exempt from PRSI on all income, regardless of whether you are working or drawing a pension. [1, 2]

If you were born on or after January 1, 1958 (Aged 66–70): Under the current flexible pension rules, the standard PRSI exemption age is 70. However, you become exempt early if you have been awarded the State Pension (Contributory). [1, 2]
 
Brendan Burgess said:
If you were born before January 1, 1958 (Aged 66+ by Jan 2024): You are completely exempt from PRSI on all income, regardless of whether you are working or drawing a pension. [1, 2]
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That's not what Revenue say in the bit that I quoted above.
According to that you're only exempt if you're:
  • Aged 66+ and drawing the OACP, or
  • Aged 70+
 
A person born before 1st January 1958 is not allowed to defer their COAP, therefore they are automatically exempt from payment of Prsi after age 66.

This was the rule before the facility to defer the COAP was introduced and this still applies to this category of people.
 
ClubMan said:
Even if they don't qualify for the contributory pension?
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Yes.

Some people will be winners and others have lost out.

A person born before 1st January 1958 who had 519 Prsi contributions at age 66 got no COAP. Being automatically exempt from paying Prsi after age 66 is no consolation for this person. This person is a loser.

A person born after 1st January 1958 who has 519 Prsi contributions at age 66 can defer for 1 week and be awarded a partial COAP. This person is a winner.

A person born after 1st January 1958 who cannot reach 520 Prsi contributions before age 70 is a loser. This person remains liable to pay Prsi up to age 70 but will never qualify for any COAP.

Some pre 95 public sector workers could find themselves in this position. They could be required to pay Prsi up to age 70.

If they have unearned income they will pay Prsi on this.
Because they will be in receipt of an occupational pension liable to class M Prsi, they will pay class K on their unearned income.

Class K is not Reckonable for the COAP.

Pre 95 public sector workers and Prsi until age 70.

This category of workers may not be able to qualify for the contributory pension at age 66. If they don't qualify they will remain liable to Prsi on rental and investment income up to age 70. They will pay class K Prsi on their unearned income. This is charged at 4% and gives no reckonable...
www.askaboutmoney.com
 
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The key point of my initial post was that despite the fact that you are of the right age and that you are receiving the COAP, you must tick the box to claim exemption from PRSI.

Brendan
 
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