Subject to mandatory insurance for old age, disability and death in Ireland

H

Horatio

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Hi Folks,
Where I currently live overseas I pay into a second pillar pension which covers insurance for old age, disability and death. There is a minimum mandatory payment to be made by both employee & employers with additional contributions also allowed.

I'm looking into withdrawing this pot in full (mandatory + non mandatory) if I decide to return to Ireland. The local rule for withdrawal states that I can only withdraw both mandatory + non mandatory components if the EU/EFTA state I move to (Ireland) does not have a mandatory insurance requirement for old age, disability and death.

I am correct to say that Irish law does not have a mandatory insurance requirement for old age, disability and death?

Thanks folks for your expertise & thoughts.
 
Every worker in Ireland must pay social insurance (SI), and some of the benefits are:

first pillar State pension
sick pay = Illness Benefit
disability pay = Invalidity pension
 
I didn't think any part was or wasn't hence my original post to educate myself. Hope that's ok with you?
 
Horatio said:
I didn't think any part was or wasn't hence my original post to educate myself. Hope that's ok with you?
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I was asking a genuine question.

PRSI is mandatory on all income.
It covers old age (contributory pension)
It covers disability.
It covers death, in that it provides a survivor / widower pension. It used to provide a bereavement grant prior to 2014.

I can't see which part you've a doubt about? Unless there's something in the specific wording that I've missed in your post? In an EU context, PRSI privides a second Pillar pension, just not called that here.

Are you currently based in an EEA country?
 
@RedOnion

I had neither a doubt nor a certainty, my question was posed as wide open. I've not lived in Ireland in quite a while & I'm coming at this topic from a position of ignorance seeking education.

Ok, so PRSI = 2nd pillar equivalent, this is helpful, thank you.
Not currently EEA but EFTA -yes. In short Switzerland.
 
Horatio said:
Switzerland
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I didn't mean any offence in my post, I thought I had completely misunderstood your question.

Switzerland have signed up to an EU social security agreement, so you can draw benefits in Ireland based on your contribution in Switzerland. The EU agreement was predated by a bilateral agreement durectly with Ireland. As such I doubt you'd be able to claim a refund, but that's the view of a lay person. Luckily you're not the first person to make the move, so there should be lots of people who've find it that can advise.
 
No offence taken. Thank you for your engagement.

Horatio said:
@RedOnion

Ok, so PRSI = 2nd pillar equivalent, this is helpful, thank you.
Click to expand...

I've done some digging here to better understand which pillar maps to what in Irish context. Based on that I'm not convinced that PRSI = 2nd pillar equivalent. The graphic below would suggest first pillar = PRSI. If my read is correct then I arrive back at my original question but let me rephrase / clarify it in light of the graphic below...

While I understand that it may be mandatory for Employers to offer "Occupational plans" in Ireland, is it mandatory for employees to avail of those plans?

4206
 
Ok, my naïve understanding is that the Pillar 1 / 2 in an Irish context is non-contributory Vs contributory pension.

And your pillar 3 is an Irish occupational pension.

But I could be completely wrong! Very probably.
I'll leave it to someone familiar with the Swiss situation to respond.
 
RedOnion said:
Does PRSI count?
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I think there is a difference between PRSI and a segregated pension contribution which the original question asked about. I know we think of PRSI contributions as funding old age etc but in fact they are general taxation and are absorbed into Exchequer current income. State benefits are paid out of current expenditure. PRSI contributions are mandatory in the same way as taxation generally is mandatory and may be used to determine access to certain benefits but there is no link between a specific contribution history and a designated pool. So I don't think there is a mandatory equivalent in Ireland as this "second pillar"

The equivalent to pillar 2 in Ireland would be a standard company / occupational plan where the employer contributes. The equivalent to pillar three would be if you set up an additional personal pension independent of any employer - or a bit like the savings products in the UK (PIPS / PEPS?). Neither of these would be obligatory.

But - defo get advice
 
EmmDee said:
I think there is a difference between PRSI and a segregated pension contribution which the original question asked about.
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You don't have to disagree with me on everything you know!!

So, I asked someone that might know, and there are different rules for each part.

The mandatory part ; you can't claim a refund because of.... PRSI (that mandatory insurance thing we have here!) Switzerland signed to a bi-lateral agreement. You have to put it into a vested benefits account, and get it at retirement (or earlier trigger event). I understood you keep the employer contribution as well, but didn't really follow.

The non mandatory part you can claim back by proving you are leaving permanently.

Sounded like something you definitely need to get advice on. Even deciding which geographic place to put your pension impacts tax rate.

I was completely wrong with my pillar 1 / 2 description.
 
First pillar = State pensions (contributory and non-con)

Second pillar = work pensions

Third pillar = personal pensions, e.g. AVCs, self-employed, etc.
 
Horatio said:
I've done some digging here to better understand which pillar maps to what in Irish context. Based on that I'm not convinced that PRSI = 2nd pillar equivalent. The graphic below would suggest first pillar = PRSI. If my read is correct then I arrive back at my original question but let me rephrase / clarify it in light of the graphic below...

While I understand that it may be mandatory for Employers to offer "Occupational plans" in Ireland, is it mandatory for employees to avail of those plans?
Click to expand...

You are correct, PRSI is NOT second pillar.

In terms of pensions, it is mandatory for employers to offer PRSA pensions,

They do not have to contribute.

Employees do not have to enrol in them.
 
Thanks folks for all your time in unraveling this, I think we have the answer. One point above is particularly pertinent & I'll tease it out below...
 
RedOnion said:
Switzerland signed to a bi-lateral agreement. You have to put it into a vested benefits account, and get it at retirement (or earlier trigger event). I understood you keep the employer contribution as well, but didn't really follow.

The non mandatory part you can claim back by proving you are leaving permanently.
Click to expand...

This is really the question behind my question, let me explain...I know for a [broken link removed]that Swiss residents departing Switzerland for an EU destination can "cash in" both the mandatory + non mandatory components of their Pillar 2 contributions if & only if their destination country does not have a mandatory requirement for insurance cover for old age, disability and death.

Based on the above discussion I read that it is not mandatory in Ireland & as such I can pull out the lot & hit the town.
 
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