Post 1995 Garda Retirement and being a landlord

2025Question

2025Question

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Hi everyone, I have a question that I'm hoping someone can answer. My spouse is a Garda, due to retire soon age 50, so is on the post 1995 pension. A portion of this is made up of social welfare. (one third) This is given out under the provisio that they can't work/can't be self employed or will lose that third of pension. We are planning on moving home to my parents house in the countryside for a while and renting out our properties in Dublin.

One property, the one in my name, is already rented out and I pay tax on it myself as it's income supplementary to my HSE wage. My question is this, the other house is in my spouse's name, so when we rent that out, post retirement, will that be classed as self employment income, and will that then lead to them losing 1 third of their pension? Should I put my name on the house deeds and collect the rent and pay tax in my name? Should I register as a sole trader and pay tax that way. I'm sorry for the long winded question, but we have tried to seek professional advice but so far no one has been able to answer this.

Thank you for your help!
 
When they retire and start to collect their garda pension they will be class M Prsi on their pension income.

Class M is zero rated, so this will not cost them anything.

When a person with class M Prsi contributions gets rental income, the rental income is liable to Prsi class K. A person paying class K on unearned income is not considered to be in self employment.

A person who pays class S on unearned income is classed as being in self employment. Your spouse will not be in this situation.

Having class K rental income should be no different to having class K bank deposit interest income.

My guess is that they will retain their extra supplementary pension.

They will have options to claim Jobseekers Benefit after they retire and then sign on for Jobseekers credits when the payments end. This would assist them to qualify for Benefit payment 65 and also help then to get some extra Contributory pension at age 66.

The change of rules mentioned in post #2 don't prevent a person from claiming Jobseekers benefit and claiming Jobseekers credits. Jobseekers Benefit might pay a larger amount than supplementary pension. It is worthwhile checking this out.

Read this thread for more information.

Key Post - PRSI and planning retirement

This Key Post is in the form of a FAQ where I don't know many of the answers. I will update the post as I get answers. 1. PRSI payable on reaching state pension age Answer: 0 (Class M) 1a. Does this relate to the start of the tax year in which you become 66? Or to after your birthday? Answer...
www.askaboutmoney.com
 
Thank you both, that's incredibly helpful. I appreciate both replies and your knowledge.

And if say the 2nd house is in their name, would it be a good idea to put my name on deed too, then I'd just pay the tax on both each year? I'm sorry if that's a stupid question, we honestly feel a bit thick navigating all of this. So we appreciate any input.
 
Presumably you are jointly assessed for income tax.

There will probably be no difference to your overall joint tax liability regardless of who owns the houses.

But there could be an advantage if you were joint owner of his house.

If his share of the rental income was less than 7.5k per year he could qualify for Benefit payment 65.

If his share of the rental income was greater than 7.5k he would not qualify for BP 65 but could claim Jobseekers benefit from age 65 to 66

Details of this are below

However this plan is probably not worthwhile to make up any difference between BP 65 and supplementary pension, because the 6 months employment needed would cancel out 6 months of supplementary pension.

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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We're actually currently not jointly assessed, which I'm sure we should change. I think we're best finding an accountant as well to ensure we're doing this properly as it's clear this is not where our knowledge lies!
 
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