Can I pay into Irish State pension from the UK?
London
in 2002 (
aged 22) after graduating from
university
. I have been working in London since then (and will qualify for a full UK state pension upon retirement) and have no immediate plans to come home to live in Ireland.
I did summer jobs in Ireland before leaving and so have paid some tax from 1997 until 2001.
My query is to whether I can qualify for a full
Irish State pension
and what is the most straightforward way to set this up while living in London.
Can I make voluntary contributions for an Irish State pension in the same way that it is possible to do for a UK pension?
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Can I set up an Irish limited company and pay myself a nominal salary in order to make the required pension contributions?
Is there any other way for which I can set myself up for an Irish State pension in a relatively straightforward manner? I really appreciate any help or guidance you can give me in this matter.
Mr JK
The principle of State contributory pensions – and other welfare benefits that are not means tested – is that you qualify on the basis of your social insurance contributions over a period of time.
All countries that I am aware of have a minimum threshold before you can qualify for these benefits. In Ireland, that number is 520 – 10 years of
PRSI (Pay Related Social Insurance) contributions
.
In your case, despite working here for a few years before heading for the UK, you are well shy of that threshold. So, as of now, you would not qualify for any Irish State pension.
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How can I find what my likely State pension will be?
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And, given that the 520-contribution figure is also a requirement to make voluntary PRSI contributions, you will not be eligible for that either. Even if you had those contributions, you would have fallen outside the qualification window – 60 months since your most recent paid PRSI stamp.
You refer to the UK system of voluntary national insurance but it, too, has rules and a limit on how far back you can go.
So there is no, as you put it, 'relatively straightforward' way you can set myself up for an Irish State pension.
Could you set up a limited company here as a vehicle to allow you to pay contributions? To be honest, I'm not across company law sufficiently to answer one way or the other, but one thought comes to mind – why bother?
There are costs involved in setting up and running a limited company even if it were possible.
More pertinently, your life now is in the UK. You have spent your entire adult working life since graduation in the UK, it is your home and, by your own admission, you have no real intention to return to Ireland.
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Am I too late to apply to boost my UK pension?
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If you were eligible for a State contributory pension, it could be paid to you in the UK but it seems to me that you would be far better to invest in a private pension in the UK, availing of the tax relief available and with more control over its investment priorities.
You are currently 45 with the possibility/ likelihood of 20+ years left in your working life. As I understand it, you can get tax relief at 20 per cent on any money you invest over there in a private pension and a 25-year investment window is more than enough to deliver a strong return.
I am conscious there was a lot of talk recently about Irish residents who had worked in the UK for a time beefing up their UK national insurance record to qualify for or increase a future UK state pensions but that was different for two reasons.
First, the qualifying criteria were lower under a special amnesty arrangement and second the cost of purchasing that extra entitlement was attractive for many people.
Please send your queries to Dominic Coyle, Q&A, The Irish Times, 24-28 Tara Street, Dublin 2, or by email to
dominic.coyle@irishtimes.com
, with a contact phone number. This column is a reader service and is not intended to replace professional advice
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