FARMERS and their spouses have been advised to ‘put the microscope’ on their future pension plans in relation to their PRSI contributions.
As a basic ‘rule of thumb’, farmers – or their spouses paying PRSI – need to have a total of 520 contributions (10 years) to qualify for the full contributory state pension worth €238.80 per week after Budget 2017.
IFA National Farm Family and Social Affairs Committee Chairperson, Maura Canning, asked farm families to check up on their pensions as regards PRSI contributions sooner rather than later.
“We really talking about a significant income supplement when people reach retirement age and the big plus about the contributory pension is that it’s not means tested.
“The difficulty is that if people don’t have the required number of PRSI contributions made it can result in reduction in their pension payments for the rest of their lives,” said Maura Canning.
She also pointed out that since 2014, spouses and civil partners of farmers, can qualify to make PRSI payments as a ‘self-employed worker’.
There are four requirements for the making of PRSI contributions:
Demonstrate that you perform similar tasks as your self-employed spouse or civil partner.
Demonstrate that you income from all sources exceed the minimum self-employed insurability threshold of €5,000.
The income from his/her contribution on the farm must be shown as trading income or a share of profits in the pay and file return made under Revenue’s self-assessment system of tax.
Maura Canning said that the earlier farmers and their spouses/partners can get ‘up-and-running’ with their PRSI contributions the better their chances of qualifying for the full contributory state pension.
For more, read this week’s Connacht Tribune.