Publication
Operational Guidelines: PRSI - PRSI Voluntary Contributions
From Department of Social Protection
Published on
Last updated on
A person under the age of 66,, or in the case of a person born on or after 1 January 1958 who is aged between 66 and 70 years and has not been awarded the State Pension (Contributory), who ceases to be covered by compulsory PRSI may opt to become a Voluntary Contributor, provided certain conditions are satisfied.
Voluntary Contributions are designed to facilitate employees or self-employed persons who are no longer subject to compulsory PRSI, to pay contributions directly to the department on a voluntary basis, in order to protect their future State Pension Contributory (SPC), Widow(er)’s Contributory Pension and Guardian’s Contributory Payment entitlements.
It is important to note that voluntary contributions do not cover short-term benefits like the Illness, Jobseekers, Maternity, Paternity, Occupational Injury or Treatment Benefit schemes, and they cannot be used to satisfy the social insurance requirements of an Invalidity Pension.
The Legislation dealing with voluntary contributions is contained in Chapter 4 of Part II of the Social Welfare Consolidation Act, 2005 - as amended - and in Articles 28 to 37 of the Social Welfare (Consolidated Contributions and Insurability) Regulations, 1996 (SI 312 of 1996) - as amended.
Client Eligibility Services - Waterford
Address:
Department of Social Protection, Social Welfare Services Office, Cork Road
, Waterford
Phone number:
In order to be admitted as a voluntary contributor, a person must:
- have at least 520 weeks *PRSI paid under compulsory insurance in either employment or self-employment, if seeking admittance from a date on or after 6th April 2015, AND
- apply within 60 months (5 years) after the end of the contribution year during which they last paid compulsory insurance or during which they were last awarded a credited contribution. In very exceptional circumstances, this period may be extended at the discretion of the Minister
- submit an application to the above address, using the Form VC1
Contributions paid at Class J (Occupational Injuries Benefit) cannot be used to satisfy these conditions. However, it is possible to pay PRSI at Class J and Voluntary Contributions at the same time. A small number of persons have chosen to pay voluntary contributions whilst subsequently being in receipt of credited contributions. It should be noted that current legislation permits those persons to continue to pay voluntary contributions.
There are three different rates of voluntary contributions:
High Rate:
Payable at 6.6% by those who last paid contributions at class A, E or H. Subject to a minimum annual payment of €500.
Cover is provided for:
- State Pension (Contributory)
- Widow's or Widower's Contributory Pension
- Guardian's (Contributory) Payment
Low Rate:
Payable at 2.6% by those who last paid contributions at class B, C or D. Subject to a minimum annual payment of €250.
Cover is provided for:
- Widow's or Widower's Contributory Pension
- Guardian's (Contributory) Payment
Special Rate:
Payable at a flat rate of €500 until 30 September 2024 (€650 from 1 October 2024)*, by those who were previously self-employed.
*Due to a change in the flat rate payment during the year (from 1 October 2024), a blended/proportionate payment of €537.50 will apply.
Cover is provided for:
- State Pension (Contributory)
- Widow's or Widower's Contributory Pension
- Guardian's (Contributory) Payment
A list of the current rates is contained in Information Leaflet SW 19.
A person who has been admitted as a voluntary contributor can choose the point in time from where they decide to pay voluntary contributions, as follows:
- a person can elect to pay voluntary contributions from the week immediately after they last paid a compulsory PRSI contribution as an employed or self-employed contributor OR
- a person can elect to pay voluntary contributions from the commencement of any subsequent contribution year of their choice, within the time period covered by their admittance
For example, if a person was being given the option of paying voluntary contributions going back 60 months (5 years), she or he can opt against paying voluntary contributions over the first 2 years of that admittance period, in favour of paying over the last 3 full years of that period and so on.
All payments should be made direct to the department's Accounts Branch in either a lump sum at the end of the contribution year, or by instalments agreed with the Voluntary Contributions Section.
Voluntary contributions must be paid within twelve months of the billing date of the amount that is due in respect of the year to which the contribution relates. However, payments can be accepted beyond the normal time limit at the Minister’s discretion, if very exceptional circumstances exist and the contributor can demonstrate good cause for the delay.
When the full amount of voluntary contributions charged in a given year has been paid, 52 voluntary contributions are awarded in that year.
If the full amount of a voluntary contribution is not paid within the specified time, or if a previously agreed instalment arrangement is not kept and good cause for delay cannot be demonstrated by the contributor all late payments are required to be refunded or returned to the person under the Regulations.
The only other circumstances where a voluntary contribution is refundable is where it transpires at a later point that a contributor has already paid a voluntary contribution, has resumed paying compulsory PRSI as either an employed, or self-employed contributor. There is no provision under current legislation to refund or return voluntary contributions where a voluntary contributor is in receipt of credited contributions, as both contribution types can occur simultaneously.
No voluntary contributions are awarded in circumstances where payments are refunded or returned.
