Publication
Changes to Pay Related Social Insurance (PRSI)
From Department of Social Protection
Published on
Last updated on
From Department of Social Protection
Published on
Last updated on
Since 1 January 2024, a person can draw down their State Pension (Contributory) between age 66 and 70. This gives a person the opportunity to continue to work and pay PRSI which may improve their contribution record at the date they decide to draw down their State Pension (Contributory).
Since 1 January 2024, the upper age limit for PRSI exemption was changed by legislation from age 66 to age 70. This applies to the employee, the employer and the self-employed PRSI liability.
This change applies to all persons who are employees and the self-employed with the exception of the following main categories:
The PRSI position for people who already reached age 66 by 1 January 2024 is unaffected by the changes. For example, employees do not have to pay PRSI on their income and their employer will continue to pay Class J at the 0.5% rate.
It is important for an employer to return the correct PRSI class as an incorrect return could lead to:
Since 1 January 2024, employers need to know whether their employee, who is aged between 66 and 70 and born after 1 January 1958, has been awarded the State Pension (Contributory) to assign the appropriate PRSI class.
To assist employers in identifying whether their employees are in receipt of the State Pension (Contributory), from January 2025, a new field “State Pension Contributory” will be included in Revenue’s Payroll Notification (RPN). This new field will indicate an employee is in receipt of the State Pension (Contributory) by having an indicator “True” for Yes.
When a person is awarded the State Pension (Contributory), the letter from the Department of Social Protection advises them that their employer will be notified via Revenue’s Payroll Notification to ensure the correct PRSI class is applied.
Since 1 January 2024, employees aged between 66 and 70 and born after 1 January 1958 continue to be liable for PRSI until such time as they are awarded the State Pension (Contributory) or reach age 70.
Once an employee is awarded their State Pension (Contributory) and continues to work, their employer will be notified via Revenue’s Payroll Notification to ensure they do not continue to pay PRSI (PRSI Class J will apply).
Since 1 January 2024, self-employed persons aged between 66 and 70 and born after 1 January 1958 continue to be liable for PRSI until such time as they are awarded the State Pension (Contributory) or reach age 70.
Once a self-employed person is awarded their State Pension (Contributory) and continues to work, they will not be liable for PRSI (PRSI Class M will apply).
Ann is 68 (date of birth 9 August 1955) employed in retail and earning €100 per week, not in receipt of State Pension (Contributory).
Ann’s earnings were not subject to PRSI as she was over 66 years. PRSI Class J applies.
Ann’s earnings are not subject to PRSI as she was over 66 years on 1 January 2024. PRSI Class J continues to apply.
Mary is 68 (date of birth 9 August 1955), employed in retail and earning €100 per week, in receipt of State Pension Contributory.
Mary’s earnings are not subject to PRSI as she was over 66 years as at 1 January 2024 and she is in receipt of State Pension (Contributory). PRSI Class J applies.
Mary’s earnings are not subject to PRSI as she is over 66 years on 1 January 2024 and she is in receipt of State Pension (Contributory). PRSI Class J continues to apply.
Joe is 65 (date of birth 9 December 1958), employed in retail and earning €100 per week, does not have a State Pension (Contributory) entitlement.
Joe’s earnings are subject to PRSI as he is under 66 years but under previous rules his earnings would become exempt from PRSI when he reaches 66 years on 9 December 2024. PRSI Class A currently applies.
Joe’s earnings will continue to be subject to PRSI as he was born after 1 January 1958, is under 70 years, and is not in receipt of State Pension (Contributory). PRSI Class A continues to apply after age 66.
Pat is 65 (date of birth 9 December 1958) employed in retail and earning €100 per week, and has an entitlement to State Pension (Contributory), which he intends to exercise, on attaining 66 years.
Pat’s earnings are subject to PRSI as he is under 66 years but under previous rules his earnings would become exempt from PRSI when he reaches 66 years on 9 December 2024. PRSI Class A currently applies.
Pat’s earnings will be exempt from PRSI from his 66 birthday (9 December 2024) as he will be in receipt of State Pension (Contributory) from that date. PRSI Class J will apply from age 66.
Sean is 65 (date of birth 9 December 1958) employed in retail and earning €100 per week and has an entitlement to State Pension (Contributory) on attaining 66 years. However, Sean has decided to not take his State Pension (Contributory) at 66 and defer to a later date.
Sean’s earnings are subject to PRSI as he is under 66 years but under previous rules his earnings would become exempt from PRSI when he reaches 66 years on 9 December 2024. PRSI Class A currently applies.
Sean’s earnings will continue to be subject to PRSI as he was born after 1 January 1958, is under 70 years, and is deferring his receipt of State Pension (Contributory) that is, is not in receipt of State Pension Contributory. PRSI Class A will continue to apply.
| PRSI Class | Person Born Before/After 1 January 1958 | Current PRSI Class under age 66 | PRSI Class after age 66 under previous rules | From 1 January 2024, contributors aged between age 66 & 70 and who have not been awarded SPC | From 1 January 2024, contributors aged between age 66 & 70 and who have been awarded SPC | PRSI Class Post Age 70 |
| A | Before | A | J | J | J | J |
| After | A | J | A | J | J | |
| S | Before | S | M | M | M | M |
| After | S | M | S | M | M |